General Electric - Comparative Multiple Analysis

General Electric (Comparative Multiple Analysis)

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Notes on the Comparative Multiple Analysis of General Electric

WikiWealth compares General Electric'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 General Electric's comparative analysis.

Notes from the analysis:

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


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

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

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