Valero Energy - Comparative Multiple Analysis

Valero Energy (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of Valero Energy

WikiWealth compares Valero Energy'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 Valero Energy's comparative analysis.

Notes from the analysis:

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

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

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

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