A justified multiple is the P/E, P/B, or similar ratio implied by fundamentals such as payout, required return, growth, and ROE. For example, a justified leading P/E relates payout to (r − g), and a justified P/B relates (ROE − g) to (r − g). It bridges DCF thinking and comps. Using an observed market multiple as if it were already “justified” without checking fundamentals is the confusion to avoid.