Transaction Comps Modeling Exam | Wall
Street Prep 2025 Edition
Complete Exam with Verified Questions, Step-by-Step Calculations, and Rationales
A+ Graded | Updated for 2025 | Comprehensive Financial Modeling Practice
About This Exam
The Transaction Comps Modeling Exam (Wall Street Prep 2025 Edition) is a professional-level
assessment designed for investment banking, private equity, and valuation professionals.
It replicates the modeling exercises and analytical reasoning found in real Wall Street Prep certification
programs, focusing on precedent transaction analysis—a key valuation methodology used in M&A
and corporate finance.
This exam tests both technical modeling proficiency and conceptual understanding, assessing your
ability to:
Analyze and interpret transaction multiples (EV/EBITDA, EV/Revenue)
Build a precedent transactions database
Calculate Enterprise Value (EV), Equity Value, and Offer Premiums
Perform sensitivity analysis using Excel functions
Apply valuation judgment consistent with market practices
By the end of this exam, you’ll demonstrate complete mastery of Transaction Comps valuation
modeling—a core skill in financial analysis and deal advisory.
Exam Format
Total Questions: 75
Type: Mix of theory, Excel-based, and numerical calculation questions
Difficulty: Advanced (Investment Banking / Private Equity Analyst level)
Tools Allowed: Excel, calculator, and financial modeling notes
Duration: 90 minutes recommended
✍️ Answer Format
Each question in this document follows a consistent and exam-verified answer format:
,Topics Covered
✅ Precedent Transaction Analysis
✅ Enterprise Value and Equity Value Relationships
✅ EV/EBITDA and EV/Revenue Multiples
✅ Offer Premiums and Control Adjustments
✅ Excel-Based Modeling Functions (MEDIAN, MAX, IFERROR, etc.)
✅ Sensitivity and Scenario Analysis
✅ Case Study: AlphaTech Industries Valuation
Q1. What is the primary objective of a Transaction Comps analysis?
✔️ To determine a company’s implied valuation range based on precedent M&A
transactions.
Rationale Transaction Comps are used to estimate what acquirers have paid for
similar companies under comparable circumstances, serving as a market-based
valuation benchmark.
Q2. Why are precedent transaction multiples typically higher than trading
multiples?
✔️ Because they include a control premium and synergy expectations.
Rationale Buyers often pay above market price to gain control, reflecting
strategic synergies and acquisition premiums.
Q3. Which data source is most commonly used for historical M&A transaction
information?
✔️ Capital IQ, PitchBook, or Refinitiv (formerly Thomson Reuters).
Rationale These databases contain transaction details including deal value, EV,
EBITDA, and premium metrics essential for comps modeling.
, Q4. What is the control premium in M&A transactions?
✔️ The additional amount paid by an acquirer above the target’s unaffected
market value.
Rationale Control premiums compensate existing shareholders for relinquishing
ownership and reflect synergies anticipated by the buyer.
Q5. In Transaction Comps modeling, why is Enterprise Value (EV) used instead of
Equity Value for most multiples?
✔️ Because EV reflects the value of both debt and equity holders — the total
capital invested in the business.
Rationale EV-based multiples (like EV/EBITDA or EV/Revenue) standardize
valuation across firms with different capital structures.
Q6. Which of the following would most likely distort Transaction Comps results?
✔️ Including outlier transactions that are not comparable in industry, size, or
timing.
Rationale Proper comp selection requires qualitative and quantitative filters to
ensure meaningful benchmarks.
Q7. What is the main difference between Transaction Comps and Trading Comps?
✔️ Transaction Comps use acquisition prices, while Trading Comps use current
market prices.
Rationale Transaction Comps reflect acquisition valuations inclusive of
premiums; Trading Comps reflect market valuations without premiums.
Q8. What is the key output of a Transaction Comps model?
✔️ A valuation range expressed through transaction multiples (e.g., EV/EBITDA,
EV/Revenue).
Street Prep 2025 Edition
Complete Exam with Verified Questions, Step-by-Step Calculations, and Rationales
A+ Graded | Updated for 2025 | Comprehensive Financial Modeling Practice
About This Exam
The Transaction Comps Modeling Exam (Wall Street Prep 2025 Edition) is a professional-level
assessment designed for investment banking, private equity, and valuation professionals.
It replicates the modeling exercises and analytical reasoning found in real Wall Street Prep certification
programs, focusing on precedent transaction analysis—a key valuation methodology used in M&A
and corporate finance.
This exam tests both technical modeling proficiency and conceptual understanding, assessing your
ability to:
Analyze and interpret transaction multiples (EV/EBITDA, EV/Revenue)
Build a precedent transactions database
Calculate Enterprise Value (EV), Equity Value, and Offer Premiums
Perform sensitivity analysis using Excel functions
Apply valuation judgment consistent with market practices
By the end of this exam, you’ll demonstrate complete mastery of Transaction Comps valuation
modeling—a core skill in financial analysis and deal advisory.
Exam Format
Total Questions: 75
Type: Mix of theory, Excel-based, and numerical calculation questions
Difficulty: Advanced (Investment Banking / Private Equity Analyst level)
Tools Allowed: Excel, calculator, and financial modeling notes
Duration: 90 minutes recommended
✍️ Answer Format
Each question in this document follows a consistent and exam-verified answer format:
,Topics Covered
✅ Precedent Transaction Analysis
✅ Enterprise Value and Equity Value Relationships
✅ EV/EBITDA and EV/Revenue Multiples
✅ Offer Premiums and Control Adjustments
✅ Excel-Based Modeling Functions (MEDIAN, MAX, IFERROR, etc.)
✅ Sensitivity and Scenario Analysis
✅ Case Study: AlphaTech Industries Valuation
Q1. What is the primary objective of a Transaction Comps analysis?
✔️ To determine a company’s implied valuation range based on precedent M&A
transactions.
Rationale Transaction Comps are used to estimate what acquirers have paid for
similar companies under comparable circumstances, serving as a market-based
valuation benchmark.
Q2. Why are precedent transaction multiples typically higher than trading
multiples?
✔️ Because they include a control premium and synergy expectations.
Rationale Buyers often pay above market price to gain control, reflecting
strategic synergies and acquisition premiums.
Q3. Which data source is most commonly used for historical M&A transaction
information?
✔️ Capital IQ, PitchBook, or Refinitiv (formerly Thomson Reuters).
Rationale These databases contain transaction details including deal value, EV,
EBITDA, and premium metrics essential for comps modeling.
, Q4. What is the control premium in M&A transactions?
✔️ The additional amount paid by an acquirer above the target’s unaffected
market value.
Rationale Control premiums compensate existing shareholders for relinquishing
ownership and reflect synergies anticipated by the buyer.
Q5. In Transaction Comps modeling, why is Enterprise Value (EV) used instead of
Equity Value for most multiples?
✔️ Because EV reflects the value of both debt and equity holders — the total
capital invested in the business.
Rationale EV-based multiples (like EV/EBITDA or EV/Revenue) standardize
valuation across firms with different capital structures.
Q6. Which of the following would most likely distort Transaction Comps results?
✔️ Including outlier transactions that are not comparable in industry, size, or
timing.
Rationale Proper comp selection requires qualitative and quantitative filters to
ensure meaningful benchmarks.
Q7. What is the main difference between Transaction Comps and Trading Comps?
✔️ Transaction Comps use acquisition prices, while Trading Comps use current
market prices.
Rationale Transaction Comps reflect acquisition valuations inclusive of
premiums; Trading Comps reflect market valuations without premiums.
Q8. What is the key output of a Transaction Comps model?
✔️ A valuation range expressed through transaction multiples (e.g., EV/EBITDA,
EV/Revenue).
