1Two families of valuation

Relative valuation asks what the market pays for similar things. If comparable companies trade at 10 times EBITDA, ours is probably worth something near that. It is fast and grounded in real prices, but it inherits whatever mood the market is in.

Intrinsic valuation asks what the company's own future cash flows are worth today. The discounted cash flow, or DCF, is the main version. It does not care what anyone else trades at, but it is only as good as the forecasts and the discount rate you feed it.

2The three standard methods

Banks almost always run all three, because each fails in a different way. Comps are only as good as the peer set. Precedents may be old or few. A DCF can say anything if you lean on the assumptions. Agreement across methods builds confidence; disagreement tells you where to look.

3The football field

The output is rarely a single number. Each method produces a range, and bankers stack the ranges as horizontal bars on one chart. Because the bars look like the yard lines on a field, the chart is called a football field.

A board looking at this sees where most of the methods overlap, roughly $26 to $27 here (the LBO range sits below it), and where a proposed offer sits. The 52 week range is not a valuation method, but it is always shown as a reference point because shareholders anchor on it.