Pre-Paid Legal - Comparative Multiple Analysis

Pre-Paid Legal (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of Pre-Paid Legal

WikiWealth compares Pre-Paid Legal'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 Pre-Paid Legal's comparative analysis.

Notes from the analysis:

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

How does this work? The Comparative Investment Analysis determines the value of Pre-Paid Legal by comparing Pre-Paid Legal 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 Pre-Paid Legal.

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

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