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I have a transaction (intrinsic value) model going on here. I've used annual, historical data exclusively (2011, 2012, 2013). My first forecast year is 2014. The company reported 1Q14, so LTM data exists. I need to use multiples for my ref range. Do I 1) stick with the yearly data and apply multiples to the annual data (for 2013 -- I can go back in time, thanks to CapIQ, and get comp multiples for that period in time) or 2) do I display an LTM column on my IS and apply only current, LTM multiples? In industry, we applied LTM multiples to LTM data, but that was a quarterly earnings model that hinged upon EV/EBITDA. I'm trying to avoid having this thing go quarterly.
Many thanks in advance. Read More