Both companies involved on either side of an M&A deal will value the target company differently. The seller will value the company at the highest price possible, while the buyer will attempt to buy it for the lowest price. A company can be valued by studying comparable companies (comparables analysis) in an industry by relying on a sample of the following metrics:
Price-to-Earnings Ratio (P/E Ratio)
Enterprise-Value-to-Sales Ratio (EV/Sales)
Discounted Cash Flow (DCF)
Replacement Cost