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18 February, 07:18

Knowledge check

what are the possible weaknesses of this peer approach to valuation?

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Answers (1)
  1. 18 February, 09:22
    0
    The growth which is estimated is wrong.

    Explanation:

    The Prospective price to earning ratio P/E multiples are calculated using future earnings. In that way, they can be dramatically wrong. Relative valuation is quick and easy. It compares industry peer.
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