ABB Ltd - Comparative Multiple Analysis

ABB Ltd (Comparative Multiple Analysis)

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Notes on the Comparative Multiple Analysis of ABB Ltd

WikiWealth compares ABB Ltd's revenue, EBITDA, and EBIT multiples to their peers in order to determine the appropriate fair valuation. Click in the top right corner to experiment with ABB Ltd's comparative analysis.

Notes from the analysis:

1. WikiWealth uses quantitative measures to determine the multiple range for ABB Ltd.
2. Free cash flow to the firm (FCF) multiple is free cash flow to equity holders plus interest owed to ABB Ltd's debt holders.
3. Multiples incorporate benefits due to economies of scale; WikiWealth compares absolute enterprise value multiples to competitor's multiples.
4. WikiWealth excludes outliers when calculating individual company multiples.

Helpful Information for ABB Ltd's Analysis


How does this work? The Comparative Investment Analysis determines the value of ABB Ltd by comparing ABB Ltd financial ratios, prices, growth rates, margins, etc. to those of relevant peer groups.

Value Investing Importance? This method is widely used by investment professionals to determine the correct price of investments, especially initial public offerings (IPOs). It is one element of WikiWealth's three Wall Street approaches used to determine the correct fair value of ABB Ltd.

See the ABB Ltd cash flow (DCF) analysis for a completely different approach that's popular on Wall Street for determining the value of an investment in ABB Ltd.

Also, see the ABB Ltd's buffett intrinsic valuation analysis for WikiWealth's attempt to replicate the investing formula's used by Warren Buffett and ABB Ltd's valuation conclusion for a quick summary.