Schlumberger - Comparative Multiple Analysis

Schlumberger (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of Schlumberger

WikiWealth compares Schlumberger'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 Schlumberger's comparative analysis.

Notes from the analysis:

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

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

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

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