Valuation

The three core methodologies are DCF (discounted cash flow), comparable company analysis (trading comps), and precedent transaction analysis (deal comps). You should be able to walk through each, explain the key assumptions, and discuss when one method is preferred over another.

Master the five-step DCF framework: project free cash flows, calculate terminal value, determine the discount rate (WACC), discount everything back, and arrive at enterprise value. Practice walking through the entire analysis in under two minutes.

EV/EBITDA is the most commonly used multiple in banking. Also know EV/Revenue (for pre-profit companies), P/E (for equity value comparisons), and understand the difference between enterprise value and equity value multiples.

Almost certainly. "Walk me through a DCF" is one of the most common interview questions at every bank. Have a structured, concise answer that covers the key steps and demonstrates you understand the logic, not just the mechanics.

Terminal value captures the company value beyond the explicit forecast period. Know both the perpetuity growth method and the exit multiple method, when to use each, and why terminal value often represents the majority of total DCF value.

Enterprise value represents the total value of a company to all capital providers (debt and equity holders), while equity value represents only the portion belonging to shareholders. The bridge between them includes net debt, minority interest, and preferred stock.

Very important. Interviewers test whether you can select appropriate peer companies, choose the right multiples, normalize financials for comparability, and interpret the resulting valuation range. Comps are used in virtually every live deal.