Flaws in public company comparables

• No company is 100% comparable to another company.
• The stock market is "emotional" - your multiples might be dramatically higher or lower on certain dates depending on the market's movements.
• Share prices for small companies with thinly-traded stocks may not reflect theirfull value.

 Flaws in Precedent Transactions

• Past transactions are rarely 100% comparable - the transaction structure, size of the company, and market sentiment all have huge effects.
• Data on precedent transactions is generally more difficult to find than it is for public company comparables, especially for acquisitions of small private companies