Adobe Systems - Comparative Multiple Analysis

Adobe Systems (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of Adobe Systems

WikiWealth compares Adobe Systems'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 Adobe Systems's comparative analysis.

Notes from the analysis:

1. WikiWealth uses quantitative measures to determine the multiple range for Adobe Systems.
2. Free cash flow to the firm (FCF) multiple is free cash flow to equity holders plus interest owed to Adobe Systems'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 Adobe Systems's Analysis

How does this work? The Comparative Investment Analysis determines the value of Adobe Systems by comparing Adobe Systems 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 Adobe Systems.

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

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