Comparables

AAA

DEFINITION of 'Comparables'

A valuation technique in which a recently sold asset is used to determine the value of a similar asset. This technique is often used in real estate to determine the initial sale price of a property.

INVESTOPEDIA EXPLAINS 'Comparables'

This technique is helpful for accurately appraising the value of any asset. For example, a real estate agent may appraise the value of a home based on the most recent selling price of a house in the same neighborhood with similar attributes, such as square footage and the number of bedrooms and bathrooms.

RELATED TERMS
  1. Real Estate

    Land plus anything on it, including buildings and natural resources.
  2. Appraisal Costs

    A specific category of quality control costs. Companies pay appraisal ...
  3. Barra Risk Factor Analysis

    A multi-factor model created by Barra Inc., which is used to ...
  4. Asset Valuation

    A method of assessing the worth of a company, real property, ...
  5. Intrinsic Value

    1. The actual value of a company or an asset based on an underlying ...
  6. Asset

    1. A resource with economic value that an individual, corporation ...
RELATED FAQS
  1. How can a company execute a tax-free spin-off?

    The two commonly used methods for doing a tax-free spinoff are either to distribute shares of the spinoff company to existing ... Read Full Answer >>
  2. How are American Depository Receipts (ADRs) priced?

    The price of an American depositary receipt (ADR) is determined by the bank or other financial institution that issues it. ... Read Full Answer >>
  3. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  4. How can EV/EBITDA be used in conjunction with the P/E ratio?

    Because they provide different perspectives of analysis, the EV/EBITDA multiple and the P/E ratio can be used together to ... Read Full Answer >>
  5. How can a company reduce the unsystematic risk of its own security issues?

    Companies can reduce the unsystematic risk of their own security issues simply by doing the most effective job possible of ... Read Full Answer >>
  6. What is the difference between terminal value and residual value?

    For the purposes of business accounting or financial management, the terms residual value and terminal value refer to the ... Read Full Answer >>
Related Articles
  1. Forex Education

    Using The Price-To-Book Ratio To Evaluate Companies

    The P/B ratio can be an easy way to determine a company's value, but it isn't magic!
  2. Options & Futures

    Introduction To Gemology

    Gemology as an investment alternative may seem glamorous, but it's not for the faint of heart.
  3. Markets

    Introduction To Fundamental Analysis

    Learn this easy-to-understand technique of analyzing a company's financial statements and reports.
  4. Professionals

    DCF Vs. Comparables: Which One To Use

    DCF and Comparables models are widely used in equity valuation. We explain the pros and cons of each method.
  5. Investing

    Is There Still Opportunity in Japanese Stocks?

    Japanese stocks’ strong performance has prompted market watchers to question whether there’s still a case for adding exposure to the Land of the Rising Sun
  6. Fundamental Analysis

    Calculating Valuation

    Valuation is the process of determining what an asset is worth.
  7. Fundamental Analysis

    Calculating the Capacity Utilization Rate

    Capacity utilization rate is a ratio used to compare a current usage level against a maximum potential level.
  8. Fundamental Analysis

    Do Fast Food Franchises Mean Fast Returns?

    We look at what it takes to own a fast food franchise: the entry costs, profit potentials, challenges, and sustainability.
  9. Investing Basics

    Why These Are the Most Valuable Brands of 2015

    A company's brand can be worth billions of dollars. Here are the most valuable global brands in 2015.
  10. Entrepreneurship

    Are Tech Startups Overvalued?

    Tech companies with billion dollar valuations are mushrooming and the NASDAQ index passed 5,000. Is there an app to tell us if we are in a tech bubble?

You May Also Like

Hot Definitions
  1. Nuncupative Will

    A verbal will that must have two witnesses and can only deal with the distribution of personal property. A nuncupative will ...
  2. OsMA

    An abbreviation for Oscillator - Moving Average. OsMA is used in technical analysis to represent the variance between an ...
  3. Investopedia

    One of the best-known sources of financial information on the internet. Investopedia is a resource for investors, consumers ...
  4. Unfair Claims Practice

    The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims ...
  5. Killer Bees

    An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an ...
  6. Sin Tax

    A state-sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!