Why might a company have multiple valuations?

A company may have multiple valuations primarily because valuation methods can involve different assumptions and multiples that affect the final output. Each valuation method, such as discounted cash flow analysis (DCF), precedent transactions, or comparable company analysis, relies on its own set of assumptions regarding growth rates, discount rates, market conditions, and the financial health of the company in question. Additionally, each method may apply different multiples based on industry standards or specific company circumstances, leading to varied valuation outcomes.

Valuations also tend to reflect the context and perspective of the analyst performing the evaluation. For example, a strategic buyer might value a company differently than a financial investor due to their different goals and approaches to synergies or risk.

Other options refer to aspects that are less directly related to having multiple valuations. Analyzing different time periods can indeed lead to varying valuations, but the core reason for multiple valuations is the differing methodologies and assumptions employed. Ignoring external market conditions or considering only one financial metric would typically lead to a less comprehensive analysis, rather than multiple valid valuations.