§ Valuation ratios
Valuation multiple
Glossary version 2026-07-12.v1 · reviewed July 12, 2026
peer multiple
A ratio comparing market value with a financial measure such as earnings, sales, EBITDA, or book value. Multiples are meaningful only when the denominator, period, growth, and business quality are comparable.
A valuation multiple expresses how much investors pay for each unit of earnings, revenue, cash flow, EBITDA, or book value. Forward and trailing periods must not be mixed, and capital structure determines whether an equity multiple or enterprise-value multiple is appropriate. Peer multiples are a cross-check rather than a substitute for company-specific cash-flow and earnings analysis.