Browse Valuation and Analysis

Business Valuation Approaches

Business-valuation terms for asset-based, market, comparable-company, and sum-of-the-parts valuation approaches.

Business Valuation Approaches covers business-valuation terms for asset-based, market, comparable-company, and sum-of-the-parts valuation approaches.

Use these pages when the selected valuation method, appraisal evidence, fair-value basis, or transaction context changes the value conclusion. It sits inside Core Business Valuation Methods, so readers can move up when the broader valuation context matters.

Use the table below to choose the narrower valuation branch before relying on a model input, market multiple, forecast, risk premium, price signal, or recommendation.

What This Branch Covers

AreaUse it for
Asset-Based Approach in Business ValuationA business valuation method that estimates equity value from adjusted asset values minus liabilities.
Business ValuationThe process of estimating a company’s enterprise or equity value for investing, transactions, reporting, litigation, or planning.
Comparable Company AnalysisA relative valuation method that applies peer-company multiples to estimate a business, stock, or transaction value.
Market ApproachA valuation approach that estimates value from comparable transactions, traded securities, or observable market prices.
Sum-of-the-Parts Valuation (SOTP)A valuation method that estimates a diversified company by valuing each segment separately and adding the parts together.

What to Check

  • Forecast source, valuation date, market data, accounting adjustments, and model version.
  • Cash-flow input, discount rate, multiple, growth assumption, terminal value, balance-sheet adjustment, and scenario range.
  • Comparable set, transaction set, sector, geography, size, leverage, margin profile, and accounting basis.
  • Effect on intrinsic value, relative value, price target, margin of safety, impairment view, deal price, or recommendation.
  • Sensitivity to growth, margins, reinvestment, discount rate, exit multiple, leverage, and market conditions.

Common Mistakes

  • Treating a valuation output as a precise fact instead of a range of estimates.
  • Comparing multiples without normalizing earnings, leverage, accounting policy, growth, and risk.
  • Ignoring valuation date, source quality, cyclicality, nonrecurring items, and sensitivity analysis.
  • Using valuation terminology as personalized investment, tax, legal, or appraisal advice.

Valuation content is educational and does not provide investment, tax, legal, accounting, appraisal, or valuation advice.

In this section

Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.

Business Valuation

The process of estimating a company's enterprise or equity value for investing, transactions, reporting, litigation, or planning.

Comparable Company Analysis

A relative valuation method that applies peer-company multiples to estimate a business, stock, or transaction value.

Market Approach

A valuation approach that estimates value from comparable transactions, traded securities, or observable market prices.

Revised on Sunday, June 21, 2026