[Verse 1] When companies merge or get acquired Three valuation paths are required DCF looks at future cash streams Discount them back to present means Intrinsic value from inside out That's what discounted flow's about [Chorus] DCF and market approaches too Comparable companies give us clues Transaction multiples show the price Valuation methods, roll the dice Discount rates and EBITDA Market comps will light your way [Verse 2] Start with revenues, subtract the costs EBITDA gained, but taxes lost Free cash flows for years ahead Terminal value when growth is dead WACC becomes your discount rate Present value you calculate [Chorus] DCF and market approaches too Comparable companies give us clues Transaction multiples show the price Valuation methods, roll the dice Discount rates and EBITDA Market comps will light your way [Verse 3] Find similar firms in trading markets Price-to-earnings, revenue targets Enterprise value to EBITDA Revenue multiples, that's the way Public markets set the tone Comparable trading, not alone [Bridge] Precedent transactions tell the tale What buyers paid when deals set sail Control premium in M&A Strategic value adds today Synergies boost the final bid More than trading multiples did [Chorus] DCF and market approaches too Comparable companies give us clues Transaction multiples show the price Valuation methods, roll the dice Discount rates and EBITDA Market comps will light your way [Outro] Three methods strong, triangulate DCF and comps validate Market wisdom, cash flow art Valuation's beating heart
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