I don’t have a strong sense on the valuation of Twitter Inc (NYSE:TWTR), but I want to share with you forty companies with valuations similar to that of Twitter Inc (NYSE:TWTR) as of the close on November 7th.
Company
Ticker
Industry
Market cap
P/B
P/S
PE ttm
P/EE1
P/EE2
EE growth
yield
Adobe Systems Incorporated
ADBE
1036 – Software & Programming
27,529.77
4.03
6.61
62.10
34.50
24.50
11.67
-
Alexion Pharmaceuticals, Inc.
ALXN
0809 – Major Drugs
24,136.47
10.25
16.88
69.70
36.00
29.00
24.58
-
Allergan, Inc.
AGN
0803 – Biotechnology & Drugs
26,830.29
4.41
4.41
21.40
16.70
15.50
13.14
0.20
Allstate Corporation, The
ALL
0715 – Insurance (Property & Casualty)
24,567.41
1.22
0.72
13.80
10.30
9.50
9.34
1.90
Archer Daniels Midland Company
ADM
0515 – Food Processing
27,157.60
1.39
0.30
18.30
12.60
12.50
10.00
1.90
Baker Hughes Incorporated
BHI
0612 – Oil Well Services & Equipment
25,880.76
1.44
1.18
24.10
13.80
11.10
18.75
1.00
BB&T Corporation
BBT
0727 – Regional Banks
23,863.10
1.23
3.58
15.80
11.20
10.20
5.98
2.70
Carnival Corporation
CCL
0936 – Recreational Activities
27,001.00
1.11
1.76
24.50
21.90
15.80
12.25
2.90
Charles Schwab Corp
SCHW
0718 – Investment Services
29,963.52
3.39
5.75
33.00
25.70
21.00
18.95
1.00
CME Group Inc
CME
0718 – Investment Services
24,825.87
1.14
8.62
26.70
20.40
18.10
13.17
2.40
Cognizant Technology Solutions
CTSH
1036 – Software & Programming
26,408.19
4.96
3.29
23.30
18.70
15.90
18.30
-
Corning Incorporated
GLW
1024 – Electronic Instruments & Controls
24,907.02
1.15
3.11
13.80
12.20
10.90
17.60
2.30
Crown Castle International Cor
CCI
0939 – Rental & Leasing
21,830.17
7.32
7.53
234.90
92.00
56.70
38.77
-
CSX Corporation
CSX
1112 – Railroads
26,726.76
2.71
2.24
14.10
13.40
12.00
11.43
2.30
Cummins Inc.
CMI
0218 – Misc. Capital Goods
23,966.10
3.38
1.41
17.10
13.80
11.50
10.00
1.90
Devon Energy Corp
DVN
0609 – Oil & Gas Operations
25,591.32
1.28
2.69
(14.80)
11.50
11.00
8.40
1.40
Discover Financial Services
DFS
0703 – Consumer Financial Services
25,064.00
2.36
3.33
10.20
10.30
9.80
8.14
1.50
Estee Lauder Companies Inc
EL
0521 – Personal & Household Products
27,129.73
8.26
2.66
27.10
21.50
19.10
12.97
1.10
Exelon Corporation
EXC
1203 – Electric Utilities
24,541.52
1.15
0.98
21.20
12.70
12.80
(5.23)
4.30
Hess Corp.
HES
0609 – Oil & Gas Operations
27,839.92
1.16
1.01
7.90
14.00
14.10
5.80
1.20
LinkedIn Corp
LNKD
1018 – Computer Services
25,055.41
9.90
18.09
733.00
100.00
66.00
54.06
-
Marathon Oil Corporation
MRO
0606 – Oil & Gas – Integrated
25,041.70
1.32
1.53
15.90
11.20
12.70
10.00
2.20
Marsh & McLennan Companies, In
MMC
0712 – Insurance (Miscellaneous)
25,307.43
3.73
2.10
19.70
16.90
15.10
11.42
2.20
Noble Energy, Inc.
NBL
0609 – Oil & Gas Operations
26,993.21
3.04
6.05
26.30
17.80
16.70
15.90
0.70
Norfolk Southern Corp.
NSC
1112 – Railroads
27,004.80
2.62
2.44
15.30
13.70
12.20
12.55
2.40
Northrop Grumman Corporation
NOC
0203 – Aerospace and Defense
24,672.98
2.64
0.99
12.90
13.00
11.90
2.83
2.30
Pioneer Natural Resources
PXD
0606 – Oil & Gas – Integrated
28,235.38
3.78
8.22
241.50
34.60
28.50
16.48
-
PPG Industries, Inc.
PPG
0103 – Chemical Manufacturing
26,169.80
5.19
1.74
26.80
19.30
17.10
9.25
1.30
Public Storage
PSA
0933 – Real Estate Operations
29,002.91
5.61
15.37
37.80
33.10
30.90
6.93
3.30
Raytheon Company
RTN
0203 – Aerospace and Defense
27,009.38
3.06
1.11
14.20
13.50
12.00
8.70
2.60
Regeneron Pharmaceuticals Inc
REGN
0803 – Biotechnology & Drugs
27,921.68
18.70
16.05
38.20
51.50
35.90
29.70
-
Reynolds American, Inc.
RAI
0524 – Tobacco
28,065.60
5.53
3.39
18.10
14.90
13.70
7.70
4.90
Southern Copper Corp
SCCO
0124 – Metal Mining
23,964.20
4.61
3.84
14.80
14.30
12.70
11.50
2.40
Spectra Energy Corp.
SE
1206 – Natural Gas Utilities
23,682.60
2.71
4.53
25.30
21.30
20.70
5.45
3.40
Sprint Corp
S
0915 – Communications Services
26,981.29
1.02
1.02
(6.25)
(16.96)
(94.11)
(32.11)
-
Stryker Corporation
SYK
0812 – Medical Equipment & Supplies
28,005.55
3.20
3.15
31.80
16.00
14.70
8.16
1.40
VF Corp
VFC
0403 – Apparel/Accessories
23,606.95
4.19
2.11
20.50
17.50
15.40
11.14
1.90
WellPoint, Inc.
WLP
0706 – Insurance (Accident & Health)
25,386.06
1.02
0.37
9.30
10.20
9.50
8.21
1.80
Whole Foods Market, Inc.
WFM
0957 – Retail (Grocery)
23,509.62
6.21
1.83
43.70
36.60
30.30
18.71
0.60
Williams Companies, Inc.
WMB
0609 – Oil & Gas Operations
24,256.36
5.17
3.37
38.20
29.20
23.40
10.80
4.10
Grand Average
25,890.84
2.29
1.76
25.03
17.98
15.79
12.17
1.68
Twitter’s valuation was around $25.9 Billion at the close of regular trading on 11/7. The private equity sponsors must be jumping for joy, as they got more than they expected on the IPO, and even more, if the price of Twitter Inc (NYSE:TWTR" target="_blank">NYSE:TWTR) holds up past the time of their lockup, when they can sell their remaining shares.
Twitter has no profits, and trades at 10 times book value, versus 2.3x on their competitors here. Price-to-Sales is around 50, versus 1.8 for competitors here.
There is one thing certain here, there is a lot of profits growth expected out of Twitter. It has to go from negative profits to positive, and then soar thereafter. That would justify the valuation.
But how likely is that? There are few companies that ever do that. So be wary and avoid Twitter Inc (NYSE:TWTR" target="_blank">NYSE:TWTR) stock, realizing there is a small chance that it might be worth its present valuation, much less more.
Full disclosure: no position in Twitter Inc (NYSE:TWTR" target="_blank">NYSE:TWTR) or any companies mentioned here.
By David Merkel, CFA of Aleph Blog
The post Twitter Inc (TWTR): 40 Companies With A Similar Market Cap appeared first on ValueWalk.