American Equity - Comparative Multiple Analysis

American Equity (Comparative Multiple Analysis)

placeholder_large_analysis.png
Banner%20-%20The%20perfect%20tool%20for%20investors%281%29.gif

Notes on the Comparative Multiple Analysis of American Equity

WikiWealth compares American Equity'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 American Equity's comparative analysis.

Notes from the analysis:

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


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

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

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