What is the correct order of valuation methods from lowest to highest?

The correct order of valuation methods from lowest to highest is influenced by the fundamental nature of each technique and the parameters used to arrive at their valuations.

Starting with the Leveraged Buyout (LBO) analysis, this method generally yields lower valuations as it is based on the amount of debt a buyer can take on and the resulting cash flows necessary to service that debt. The LBO model focuses on achieving a certain return on equity, which can limit the valuation.

Next in order is the Comparable Companies analysis, or Comps, which involves comparing the target company to similar businesses. This method tends to provide slightly higher valuations as it reflects current market conditions and how peers are valued, but still operates within a competitive range driven by actual market transactions and investor sentiment.

Following Comps is the Discounted Cash Flow (DCF) analysis, which is often seen as a more comprehensive approach. DCF values a company based on its future cash flows, discounted back to present value. This method usually produces higher valuations as it is based on the expected growth of the company's cash flows and can factor in company-specific risk profiles and growth prospects.

Finally, Precedent Transactions typically yield the highest valuations. This method examines past transactions involving similar companies and often results in