comparable company

USAGE SUMMARY

The phrase "comparable company" is correct and usable in written English.
It is typically used in financial contexts to refer to companies that are similar in size, industry, or other characteristics, allowing for comparison in valuation or performance analysis. Example: "To assess the market value of our firm, we analyzed the financial metrics of several comparable companies in the tech sector."

✓ Grammatically correct

News & Media

Tech

Business

Human-verified examples from authoritative sources

Exact Expressions

10 human-written examples

There is no comparable company.

The Economist

Although sperm quality also declines as men get older, there are no comparable company perks for businessmen.

Independent

On average, according to Mercer Consulting, a British company's chief executive makes one-third of what a comparable company in the United States would pay its boss.

The New York Times

"On average, an ousted C.E.O.'s company achieves only half the profit, cash flow, and market capitalization of a comparable company led by an effective C.E.O. for the same length of time".

The New York Times

Earlier-stage companies should base growth targets and valuations on comparable company metrics.

TechCrunch

While that seems high, it's not out of line if you look at other comparable company monthly revenues.

TechCrunch

Human-verified similar examples from authoritative sources

Similar Expressions

48 human-written examples

Depending on the method, it comes up with a range of valuations from $656 million (by comparing Twitter's estimated enterprise value to comparable companies) to $751 million (by estimating revenues, margins, and a discount rate).

TechCrunch

"Similarly, Winn-Dixie trades at less than three times cash flow (measured by EBITDA) compared to 4.8 to nearly seven for the comparable companies, several of whom carry much heavier debt burdens".

Forbes

Guardian Money checked out a few comparable companies.

The Guardian - Money

"The remuneration packages of our executives are in the middle of a range of comparable companies.

The Guardian - Business

We were very aware of what was going on around us and what the comparable companies were trading at".

The New York Times

Expert writing Tips

Best practice

When using "comparable company" in financial analysis, clearly define the criteria (industry, size, growth rate) used to select these companies to ensure the comparison is relevant and meaningful.

Common error

Avoid using "comparable company" without specifying the key factors that make the companies alike. Failing to do so can lead to misleading conclusions. Instead of saying "Our company is better than a comparable company", say "Our company's profit margin exceeds the average of comparable companies in the tech sector by 15%."

Linguistic Context

The phrase "comparable company" functions primarily as a noun phrase, where "comparable" acts as an adjective modifying the noun "company". It's used to identify businesses that share key characteristics, enabling meaningful comparisons. Ludwig AI confirms that this phrase is correct and usable in English.

Expression frequency: Uncommon

Frequent in

News & Media

46%

Formal & Business

20%

Science

14%

Less common in

Wiki

4%

Academia

0%

Social Media

0%

Ludwig's WRAP-UP

In summary, the term "comparable company" is a grammatically sound and professionally relevant phrase used to denote businesses that share sufficient similarities for comparative analysis. According to Ludwig AI, the phrase is indeed correct and usable. Its main function is to provide a benchmark for evaluating a company's performance or valuation. While primarily used in news and media, it maintains a professional tone. When employing this phrase, it's vital to clearly define the characteristics that make companies comparable to avoid broad, potentially misleading comparisons.

More alternative expressions

Phrases that express similar concepts, ordered by semantic similarity:

similar business

Focuses on the business aspect, implying a company operating in the same field or industry.

equivalent firm

Highlights the equivalence in terms of size, operations, or market position.

matching corporation

Emphasizes a direct match in characteristics or performance metrics.

analogous enterprise

Uses a more formal term for 'company', suggesting a parallel in structure or function.

related organization

Indicates a connection or commonality in purpose or activities.

competitive peer

Highlights the competitive aspect within the same industry or market.

benchmark company

Emphasizes the use of the company as a standard for comparison.

parallel institution

Suggests a structural or functional similarity to another organization.

comparable entity

Uses the more generic term 'entity' to broaden the scope beyond just companies.

like-kind company

Emphasizes that the comparison is made against another company of its kind.

FAQs

How is "comparable company" used in valuation analysis?

In valuation, "comparable company" analysis identifies firms with similar business characteristics and uses their market values to derive valuation multiples for the target company. This method helps estimate a fair market value based on how similar companies are priced by the market.

What factors define a "comparable company"?

Key factors include industry, size (revenue, assets), growth rate, profitability, risk profile, and geographic location. The more aligned these factors are, the more reliable the comparison.

What are some alternatives to "comparable company"?

You can use alternatives like "similar business", "equivalent firm", or "peer company", depending on the context.

Why is it important to choose "comparable companies" carefully?

Choosing appropriate "comparable companies" is critical for accurate financial analysis and valuation. Poorly selected comparables can lead to skewed results and flawed decision-making.