Predefined lists of comparable companies

In order to run a comparable company analysis, you must start building a peer group consisting of companies of similar size, operating in the same industry, and possibly from the same region. Then you can compare a company’s multiples and ratios to those of the companies belonging to its peer group.

On the Infront Analytics platform, this process is greatly facilitated thanks to the provision of predefined lists of comparable companies for any company. Those predefined lists, made of 15 comparable companies each, are generated with a tool called Peer Tracker that compares the industry sector footprint of all companies. Only active companies with quotes and estimates can be part of the predefined lists.

Three predefined lists of comparable companies are provided in the Company Peers view, each one with a different geographic focus:

• International Peers: closest comparable companies worldwide.
• Regional Peers: closest comparable companies in the same region as the selected company.
• Domestic Peers: closest comparable companies in the same country as the selected company.

It is worth noting that the degree of relevance of predefined lists could greatly vary depending on the company considered. It is indeed not always possible to find good comparable companies using industry classifications, e.g. for large companies with activities in multiples sectors or conversely small companies operating in highly specialized subsectors.

A good indicator of the quality of a predefined list consists in the comparability scores shown for each of the peer in the list: the higher the scores, the more relevant the list. When a predefined list includes companies with low comparability scores, its quality is questionable and it is advised to modify the search settings in the Peer Tracker tool to look for additional peers with higher scores.

In the Comparable Analysis views of the Companies interface, the selected company is by default compared to its predefined international list of comparable companies. You can select any other predefined or personal list in Active List.