National Grid Transco - Comparative Multiple Analysis

National Grid Transco (Comparative Multiple Analysis)


Notes on the Comparative Multiple Analysis of National Grid Transco

WikiWealth compares National Grid Transco'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 National Grid Transco's comparative analysis.

Notes from the analysis:

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

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

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

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