Transaction Comps Insights

This problem practices the difference between trading comps and transaction comps, and why both are used in relative valuation. Candidates need to understand that trading comps reflect market pricing for minority stakes in public companies, while transaction comps incorporate acquisition pricing and the strategic context of completed deals. Interviewers ask this because they want to see whether you can explain how control, buyer appetite, and precedent transactions affect valuation, and why a valuation range from public markets alone may not tell the full story about what an acquirer might actually pay.