Series 79 practice questioneasyPrecedent Transaction Analysis
Precedent transaction analysis is also commonly known as:
- ATrading comps
- BDeal comps or transaction comps✓ Correct answer
- CSum-of-the-parts analysis
- DLeveraged buyout analysis
Explanation
Why B — Deal comps or transaction comps
Precedent transaction analysis is commonly referred to as deal comps or transaction comps in investment banking. This distinguishes it from trading comps (comparable company analysis), which examines current public market trading multiples. Transaction comps focus on the multiples paid in actual completed M&A transactions, which inherently include control premiums and any synergy expectations priced into the deal.
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