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Finance For Executives

INSEAD

Value Multiples by Sector


Data used: Value Line database of 7091 US companies.
As of January 2005
This table shows industry average valuation multiples for US COMPANIES.
You can estimate your companys or projects value by multiplying your companys
or projects EBITDA (or EBIT) by the industry average ratio. However, a more
careful estimation requires the computation of the free cash flow and the cost of
capital.
Please refer to the section: Variable Definition for further explanations.
Industry Name

Advertising
Aerospace/Defense
Air Transport
Apparel
Auto & Truck
Auto Parts
Bank
Bank (Canadian)
Bank (Foreign)
Bank (Midwest)
Beverage (Alcoholic)
Beverage (Soft Drink)
Biotechnology
Building Materials
Cable TV
Canadian Energy
Cement & Aggregates
Chemical (Basic)
Chemical (Diversified)
Chemical (Specialty)
Coal
Computer Software/Svcs
Computers/Peripherals
Diversified Co.
Drug
E-Commerce
Educational Services
Electric Util. (Central)
Electric Utility (East)
Electric Utility (West)
Electrical Equipment
Electronics
Entertainment
Entertainment Tech
Environmental

Number of
Firms

35
67
46
65
25
60
499
7
5
38
22
17
90
49
21
11
13
16
31
92
11
389
143
117
305
52
38
25
31
16
93
179
88
31
85
Number of

Value/EBITDA Value/EBIT Value/EBIT(1-t) Tax Rate

10,83
10,23
6,82
7,18
5,95
4,98
NA
NA
NA
NA
9,04
10,52
30,68
7,50
8,68
4,60
7,09
11,08
6,95
7,93
10,12
12,85
10,84
8,93
12,58
19,37
15,40
6,55
6,73
4,89
7,44
13,33
9,76
13,89
6,68

13,66
13,27
10,05
8,56
8,22
7,16
NA
NA
NA
NA
10,94
12,82
41,95
9,39
14,94
5,90
9,87
17,18
9,28
10,57
15,60
15,64
14,76
11,27
14,97
29,97
18,57
8,93
9,25
6,91
8,15
22,53
13,18
18,75
9,29

23,97
18,94
18,09
13,53
12,26
10,65
NA
NA
NA
NA
17,22
17,53
76,89
15,02
14,97
8,59
14,71
23,61
15,27
15,29
23,62
23,22
20,30
16,89
20,66
36,63
30,07
13,27
13,33
9,63
10,54
26,61
22,12
34,42
15,04

10,63%
20,26%
21,75%
20,73%
22,94%
22,81%
27,49%
29,70%
8,31%
27,82%
20,24%
20,09%
4,35%
25,76%
1,47%
32,61%
26,47%
13,07%
26,83%
16,52%
17,08%
11,06%
10,65%
20,47%
6,74%
8,19%
19,43%
29,29%
28,04%
27,26%
12,33%
12,79%
17,31%
14,36%
9,72%

Value/EBITDA Value/EBIT Value/EBIT(1-t) Tax Rate

Finance For Executives


Industry Name

Financial Svcs. (Div.)


Food Processing
Food Wholesalers
Foreign Electronics
Foreign Telecom.
Furn/Home Furnishings
Grocery
Healthcare Information
Home Appliance
Homebuilding
Hotel/Gaming
Household Products
Human Resources
Industrial Services
Information Services
Insurance (Life)
Insurance (Prop/Cas.)
Internet
Investment Co.
Investment Co.(Foreign)
Machinery
Manuf. Housing/RV
Maritime
Medical Services
Medical Supplies
Metal Fabricating
Metals & Mining (Div.)
Natural Gas (Distrib.)
Natural Gas (Div.)
Newspaper
Office Equip/Supplies
Oilfield Svcs/Equip.
Packaging & Container
Paper/Forest Products
Petroleum (Integrated)
Petroleum (Producing)
Pharmacy Services
Power
Precious Metals
Precision Instrument
Publishing
R.E.I.T.
Railroad
Recreation
Restaurant
Retail (Special Lines)
Retail Automotive
Retail Building Supply
Retail Store
Securities Brokerage

INSEAD
Firms

233
104
20
12
21
38
23
32
16
34
77
30
28
200
33
43
78
297
21
17
133
19
28
195
262
38
76
30
38
20
28
93
35
39
34
145
14
24
61
104
43
135
18
78
84
175
14
9
49
26
Number of

93,46
8,59
8,15
4,21
6,32
8,11
4,52
12,60
5,64
9,38
10,33
9,89
8,98
8,75
10,84
NA
NA
39,83
28,39
86,73
9,17
22,27
6,62
7,67
12,53
9,61
10,44
6,64
6,99
11,08
8,36
11,18
6,50
7,05
5,07
4,53
11,11
15,93
13,14
11,58
7,02
133,05
7,39
11,88
8,77
7,07
8,02
10,36
8,61
9,69

108,19
10,15
9,69
5,31
10,61
10,53
6,23
19,28
7,40
9,99
14,07
11,74
11,25
11,59
13,69
NA
NA
61,24
42,85
91,44
12,37
33,48
8,96
9,27
14,54
12,54
14,16
8,71
9,52
13,01
10,75
16,79
8,97
11,08
6,76
5,69
13,04
21,47
20,22
17,49
9,47
172,85
9,80
15,27
11,18
9,23
9,35
11,98
10,73
10,15

161,36
14,42
14,58
8,42
15,09
16,08
9,34
37,22
10,86
15,78
20,27
16,81
22,44
17,96
20,40
NA
NA
114,83
42,85
145,83
17,43
56,68
10,00
14,96
20,54
17,69
20,75
13,28
12,91
20,73
16,51
24,02
15,66
12,16
11,60
8,13
20,66
34,76
28,05
30,42
14,54
223,56
14,94
19,67
16,85
14,86
15,41
19,14
17,04
14,41

20,19%
23,76%
23,53%
30,71%
16,96%
29,42%
27,24%
13,74%
22,01%
28,14%
14,57%
24,99%
24,79%
17,97%
20,63%
19,78%
16,44%
3,51%
0,00%
2,19%
22,54%
17,91%
11,27%
16,69%
13,80%
22,57%
10,43%
27,66%
20,52%
25,31%
29,24%
19,07%
21,93%
14,16%
31,59%
15,15%
35,79%
9,30%
5,49%
13,61%
19,45%
1,88%
34,56%
20,46%
20,88%
24,76%
38,92%
36,49%
25,81%
21,08%

Value/EBITDA Value/EBIT Value/EBIT(1-t) Tax Rate

Finance For Executives

INSEAD

Industry Name

Firms

Semiconductor
Semiconductor Equip
Shoe
Steel (General)
Steel (Integrated)
Telecom. Equipment
Telecom. Services
Thrift
Tire & Rubber
Tobacco
Toiletries/Cosmetics
Trucking
Utility (Foreign)
Water Utility
Wireless Networking

124
14
28
31
16
147
190
147
18
13
25
41
6
17
77
7091

Grand Total

8,57
19.77
10.24
10.09
8.87
17.39
6.02
NA
4,56
8,02
13,22
5,12
7,28
7,87
17,96
9,66

13,10
36.13
11.95
15.10
14.07
23.10
9.25
NA
6,97
8,59
15,99
7,55
10,30
9,91
32,67
12,77

17,88
39.97
18.18
22.30
17.57
36.68
13.34
NA
11,11
13,95
23,48
12,20
14,78
15,08
35,77
18,89

10,41%
9,22%
24,94%
20,76%
14,94%
9,51%
12,71%
28,76%
19,10%
23,83%
23,33%
33,89%
17,82%
30,67%
6,35%
16,93%

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