Comp Tables

Why do we think comp tables are so important?

They are the key tool in understanding investment opportunities and risks in an industry.

And how can you manage a portfolio with wrong data?

• provide a menu of available public investment choices for purchase or sale
• show the range of valuations of the choices, showing discrepancies that may or may not converge in the future. Public valuations also inform private company valuations and acquisition pricing
• show the size and leverage of the public options
• show the range of operating margins and opportunities for margin expansion or compression
• show the cost of capital for companies and the industry, which can be applied to similar companies in the private market either raising new capital or deciding whether to sell to another company
• on the second page, the stock price performance shows what is moving up and down, helps isolate specific performance vs peers and the broader market

Read More