Comparable Company Analysis Excel Walkthrough | Valuation Multiples
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- เผยแพร่เมื่อ 25 ก.ค. 2024
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Learn comparable companies analysis, also known as comps or multiples valuation.
🆓 DOWNLOAD Free Excel file for this video: view.flodesk.com/pages/624462...
Comparable companies valuation is a valuation method that compares multiples of similar companies to determine a valuation range for a target business. This is a relative valuation method, meaning it's based on the market as opposed to the intrinsic value of the target company.
The following are the steps we take:
1. Select the comparable companies: find 5-10 companies that are comparable based on industry, growth, credit risk etc.
2. Gathering financials and calculating multiples: Find revenues, EBITDAs, earnings, etc. to calculate multiples such as EV/Revenue, EV/EBITDA, P/E etc.
3. Benchmark the multiples: calculate the average, median, high, low, and quartiles to see multiple ranges
4. Determine a valuation range: Calculate the enterprise or equity value and eventually reach an implied share price
5. Simplifications for the model: Factors we need to consider such as calendarization, shares outstanding etc.
You can follow along and practice using the excel valuation template above.
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Chapters:
0:00 - What is a Comparable Companies Valuation?
1:49 - Selecting the comparable companies
3:16 - Gathering financials and calculating multiples
7:28 - Benchmark the multiples
8:58 - Determine a valuation range
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Hi Kenji
Thank you Kenji for your videos! I am very interesting in financial modelling a valuation since two years ago and your videos have helped a lot to remember some concepts and methods in a easy way
Kenji San, Thank you for your details, pros/cons in concise matters. Keep up the good work!
Hi Kenji, thank you so much for your videos! They are one of the most helpful ones and you can explain things very well!
Thanks for the kind comment!
Love you Kenji. Would love to see a real comparable analysis if you have the time and energy. Thank you very much. Keep up the hard work!
I have been interested in Financial modeling and valuation for well over a year now. Thanks for the great work
One of the two best IB prep channels on YT. Eternally grateful for your content 🙌🏼
What is the other one called?
@@darislavdikov7573 “High Finance Graduate” is also pretty thorough.
@@keenanachziger4330 thank you
Hi Kenji, I really appreciated for your useful videos, please keep it up. Make more awesome videos like this! From Indonesia.
Love your video! It really helps a lot❤.
Super helpful video as always Kenji!! You’re the best
Hahah thank you!
I watch your videos more often. It is really helpful in implementing the theoretical knowledge into practice in a simpler way.thanks
Great to hear! thanks for watching :)
Thank you for such simple explanations and also telling us what was simplified and why. Also please make a comparable company analysis and other models for real companies.
Solid coverage of the comparable companies analysis. Super excited about the valuation course!
Thanks for the help!
Thank you for your videos and for making them easy to understand!
Glad you like them, more coming soon :)
Great content! Keep going Kenji!
Cheers Andreu! XD
Great Video! Thanks for the explanation
Hi Kenji, please do the comparable valuation for a real company. Thanks for this one.
Also, I've heard about Country premiums in comparable companies where the comps are beyond one economic environment. Can you also throw some light on that? Thanks Kenji.
Good examples, and explanation overall. Keep up the good job.
Glad it was helpful!
You explain it so simply thank you sir as always
Thanks for watching!
Hi Kenzy. would love to watch comparable company analysis on real company. Looking forward to next video on CCM.
Thanks!
thanks for sharing
Great video
Hi Kenji. I have downloaded some of your Excel Files and I wish to use them for and educational purpose. Based on the Note, I need your permission to go ahead with this. Actually, I will do some modifications on the file to be able to have it meet the purpose.
Thank you and I really enjoy your videos, they are quite explicit!
Thank you
Thank you for this video. But please I wanted to ask, if you were doing a price to book ratio, how would the comparables differ in terms of the later part where there is net debt, implieed enterprise value, etc.? basically the enjoy lemon valuation section.
Can you do a video on how to build a value chain?
Hi Kenji, thank you for your explanation it is very clear! I have one question about the multiples calculations. When calculating the multiples did you use historical financial data or forecasted data? Thank you!
Thank you! Typically you'd have one year of historical data, and 2 more years of forecasted data. For this example though, we didn't consider the years as the figures were just made up for simplicity.
@@KenjiExplains Thank you for your answer! Sorry but I have a follow up question. Is there a website or resource available which expands on the simplification made in this video? Thank you again!
Is it not more accurate to do the valuation using the EV/FCF multiple? (if the company generates fcf)
Hi Kenji, thank you for your videos!
Could you do a video show "How to do a stock pitching as a professional?"
Thank you again! Have a nice day Kenji!
Hey yeah I’ve got that noted! Hopefully in the coming months :)
How did you get your cell O to show 7.3x instead of a dollar figure?
Hello Kenji! I have a quick questions with the companies’ financial data(Revenue, EBITDA, Net Inocme) you pulled, can it be data for a single quarter? Or does it have to be full fiscal year numbers? And thank you so much for making these videos! They are SUPER helpful!!!
Yeah you can do this on a quarterly basis as well! Just make sure it's consistent (everything as quarters or everything as years) Thank you for watching my videos :)
@@KenjiExplains I see I see! Thank you so much for your speedy reply🙌🏼
Thank you for the video, it is very helpful. However, in order to calculate the implied enterprise value in EV/EBITDA, shouldn’t the median be multiplied with the EBITDA instead of the Revenue? I’m a little bit confused in this part.
Your correct, thats also what he is doing in the video.
how do you get the x's next to the multiples to automatically appear
Click on Home/Number Format/ More Format.
Then select Custom in the Number section and type 0.00"x"
Here you go
Great Video! just one question: is the shortcut alt+H+V+F correct? can't seem to work for me!
hmmm..not sure why. Could it be that you're Excel is not in English or you're using a Mac keyboard?
Yes please a comparable company video on a real company
Good stuff
Cheers!
First comment 😊
I really want to take a moment and say THANK YOU SO MUCH for your effort and your time
All of your videos have helped me to learn all models in excel.
God bless you Kenji
Hi Vishnu, really appreciate your comment! Best of luck with your career :)
Why didn't you include enjoy lemon in median high ?
Hi! I cannot download the file anymore. Could you reupload it?
Thank you very much. Could you please explain, why we add the net debt to the equity value?
Net debt(subtract cash, add liabilities) + equity value give you enterprise value(EV), a key component of indicators like EV/EBITDA
To find the enterprise value you need to add debt because it's also part of the company.
@@KenjiExplains why don't we subtract it?
@@emadr5780 don't question just do
@@australianpatriot you mean there is no reason?
Hey Kenji.
You and many TH-camr advertised for Financial Edge. But are those micro degrees actually something a recruiter would look at?
Hey there, I think it’s more the actual learning that’s valuable and can get you the right skills a recruiter might look for…not so much the certificate
Hey kengi i think you did a mistake at while calculating P/E Ratio @ 5:59 P/E formula is is (CMP OF A SHARE/EPS). Hope you find this comment useful and if I was wrong please correct me......
Hey there I don't think so...the price per share / earnings per share is the same thing as the market capitalisation / the net income. It's just at different scales (one relative, the other absolute), but the result is the same.
You are using Corporate Finance Institute (CFI) structure 😜. I'm a certified financial Modeler from there. I'm very well aware of these structures.😁😀
Hey there! I’m using the industry standard structure…not sure what you mean by the cfi structure??
File please?
Please how can I get across to you
Hi Kenji
❤❤
Do you have any coupons for your excel course?
Hey you can get 10% off using code EMAIL10
@@KenjiExplains thank you so much 🙏
Please do comparable valuation on a real company
Noted!
Ah, comps, price per square foot...real estate terms
??? you didn't minus cash when you use Equity value to calculate EV.
I used net debt which is Total Debt - Cash
@@KenjiExplains that is interesting. thanks
the video gets more difficult each time :( cant keep up
Sorry about that!
This guy is not for beginers. He is too fast and not understandable at all. Please provide a disclaimer about the pre-requisites before you dive deep in to the valuation.
Man the excel part didn't help me much when u already know everything
Hi Kenji, when I getting the Market Data, I found that it will be hard to collect the data, ESR 1821.HK, SF REIT 2191.HK, CML REIT 1503.HK, Link REIT 0823.HK, Mapletree Investment Trust MIT.SG & Goodman Group GMG.AU, as you can see, 4 company from HK, 1 from SG and 1 from AU. It is very hard to collect the market data, do you have a resource to collect data via a single resources and trustable? and use same currency?
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