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Getting started with peers on Valutico
Getting started with peers on Valutico
Updated over a week ago

When performing valuations, selecting the right group of peers is crucial. Valutico's peer selection process helps you identify companies that share similar risk characteristics with the one you're valuing. This guide will help you get started with the Peers feature on Valutico.

Understanding peer selection

The goal of peer selection is to compile a group of companies that closely resemble the company you're valuing. Among others, consider these key factors:

  1. Industry Classification: Look for companies in the same or a similar industry as the target company.

  2. Country or Region: Select peers from the same or similar geographic regions.

  3. Comparable Size: Aim to include companies of comparable size while avoiding extremely small micro-caps.

  4. Comparable Metrics: Choose peers with similar operating metrics to the target company.

Comparable public company multiples

Valutico's Trading Comparables valuation methodology relies on the principle that publicly listed companies similar to the target company should have similar trading multiples. These multiples include Enterprise Value/Sales, Enterprise Value/EBITDA, Enterprise Value/EBIT, Price/Earnings, and Price/Book.

Once you've identified a suitable set of comparable publicly traded companies, the Peer screen in Valutico displays their relevant multiples and calculates the median of the set.

You can also apply a further discount to the median if needed. This discount typically accounts for factors like differences in company size compared to the peers, as well as risks such as lack of liquidity or marketability. Users can adjust for a control premium here as well.

Financing structure

Debt-to-Capital ratio (D/C), Debt-to-Equity ratio, and Credit Spread are all important inputs for the calculation of Cost of Capital, which forms the basis for the Discount Rate calculation. Default values for these parameters are derived from the peer group.

The Credit Spread is determined using the estimated effective debt interest rate, which is calculated by dividing a peer's latest Fiscal Year interest expense by its most recent Fiscal Year debt balance. The Credit Spread is then calculated by subtracting the Risk-Free Rate of the country where the company is headquartered.


Beta measures the relative riskiness of a listed company compared to a suitable index. The median Beta of the peer group reflects the market's perceived riskiness of the industry in which the target company operates. It's essential to ensure that your set of peers represents a similar industry risk profile

Reviewing and customizing your peer list

Your valuation project in Valutico will come prepopulated with 15 peers, influenced by your inputs, among other things the country/region, industry, and similar public company. As a first step, review this list and remove companies that you don't consider similar enough to your valuation object.

You can quickly understand each company by hovering your mouse cursor over the "i" icon next to the company name. To remove a company, click the three dots to the left of its name and select "remove" or use the checkbox for multiple selections.

For in-depth research, click the icon next to the company's name to access additional information, including company profile, financials, similar peers, and Beta calculations.

Understanding median and industry median

The "Median" line displayed on the Peer screen reflects the median of the observed peer values. The discount to the median is based on the Qualitative Assessment (QA) by default, but if the QA was skipped, the default discount/premium is 0%.

The "Industry Median" provides a global industry median as a benchmark. It doesn't influence the valuation data, but is for informational and benchmarking purposes.

Searching for peers

You can search for similar peers in four ways:

  1. Similar Public Company: Add a similar public company during Valuation Creation to help Valutico's algorithms find similar companies and transactions based on key criteria like location, industry, and more.

  2. Similar Peers: On the Peer details screen, the system automatically provides a list of peers similar to the one you are looking at.

  3. Quick Add Peers: Use the search box on the top right to find peers in the database. Typing a company's name will produce search results.

  4. Advanced Search: Access the most robust method of searching for peers through the "Advanced Search." Combine filters like Industries, Countries/Regions, Company Name, Market Cap, and Full Text Search for precise results.

For more information on selecting peers, you can download our whitepaper.

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