Powell Industries - Comparative Multiple Analysis

Powell Industries (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of Powell Industries

WikiWealth compares Powell Industries'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 Powell Industries's comparative analysis.

Notes from the analysis:

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

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

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

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