Reverse Valuation Calculator: What Growth Does the Valuation Require?

ECMSource Research Workbench · Expectations

Start with an enterprise value and a future valuation multiple, then calculate the revenue and annual growth required to reach that assumption.

Set the assumptions

Use the same currency units for enterprise value and revenue.

What this answers

The result estimates the final-year revenue needed for the chosen enterprise value to equal the selected EV/revenue multiple, then calculates the compound annual growth rate from current revenue.

It does not calculate intrinsic value. It holds enterprise value fixed, ignores interim cash generation, debt changes, dilution, acquisitions, margins, taxes, and discount rates.

A lower assumed final multiple requires more revenue to support the same enterprise value. Change one assumption at a time and record why it is reasonable.

Core formulas

Required final revenue = enterprise value / final EV-to-revenue multiple
Required annual growth = (required final revenue / current revenue)^(1 / years) − 1

This is an expectations test. A complete valuation also needs profitability, reinvestment requirements, financing, risk, and a range of outcomes.

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