⬅ Toolshelf

Relative valuation

What are people paying for companies like this one?

01

The company you're valuing

Everything below is measured against these figures. Use one date for the company and every peer — mixing a trailing year here with a trailing twelve months there is the single most detectable error in this whole exercise. Per-share figures go in the same unit as the price; totals go in millions.

02

Which multiples

A multiple only means something if the top and the bottom belong to the same people. Share price belongs to shareholders, so it can only sit above a number shareholders own. Enterprise value belongs to lenders and shareholders, so it sits above profit measured before interest. The two below marked in red fail that test — they're here so you can see the failure, not so you can use them.

Tick fewer and you type less: each peer only shows the boxes your chosen multiples actually need.

03

The peers

Untick a company to drop it from the calculation and say why in the last column. That sentence is the argument — a screen nobody can follow is worth less than a narrow one you can defend.

04

The spread

Multiples are skewed — a handful of expensive companies drag the average somewhere no individual company sits. Watch the two columns diverge. Where they're far apart, the median is telling the truth and the mean isn't.

Value on
05

What each multiple says the shares are worth

One number per multiple, and the market price marked in red. If the price sits inside the spread, the market agrees with the peer group; if it sits outside, either you've found something or your peer group is wrong. Decide which before you write a word.

Implied value per share

The headline verdict uses the median across every multiple that produced a usable number.

Value per share —
Against market —
Awaiting inputs
Enter a share price and at least one peer.