What is a forward-looking multiple


Assignment:

Q1. DiversCo, a large U.S. company, operates in two areas: energy and retail clothing. You observe an analyst report that values DiversCo using multiples analysis based on a peer group of other large U.S. diversified companies. Do you think that this is an appropriate approach? Why or why not?

Q2. What is a forward-looking multiple? Why should one use forward-looking multiples as opposed to backward-looking multiples when valuing companies?

Your answer must be, typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.

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