Permian Basin Royalty - Comparative Multiple Analysis

Permian Basin Royalty (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of Permian Basin Royalty

WikiWealth compares Permian Basin Royalty'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 Permian Basin Royalty's comparative analysis.

Notes from the analysis:

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

How does this work? The Comparative Investment Analysis determines the value of Permian Basin Royalty by comparing Permian Basin Royalty 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 Permian Basin Royalty.

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

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