Sun Microsystems - Comparative Multiple Analysis

Sun Microsystems (Comparative Multiple Analysis)

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Notes on the Comparative Multiple Analysis of Sun Microsystems

WikiWealth compares Sun Microsystems'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 Sun Microsystems's comparative analysis.

Notes from the analysis:

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


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

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

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