Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
Anadarko Petroleum Corp., current price multiples
| Anadarko Petroleum Corp. | Chevron Corp. | ConocoPhillips | Exxon Mobil Corp. | ||
|---|---|---|---|---|---|
| Selected Financial Data | |||||
| Current share price (P) | $49.37 | ||||
| No. shares of common stock outstanding | 547,157,557 | ||||
| Earnings per share (EPS) | $-5.61 | ||||
| Operating profit per share | $-4.75 | ||||
| Sales per share | $15.44 | ||||
| Book value per share (BVPS) | $22.32 | ||||
| Valuation Ratios (Price Multiples) | |||||
| Price to sales (P/S) | 3.20 | 2.19 | 2.59 | 2.04 | |
| Price to book value (P/BV) | 2.21 | 2.17 | 2.37 | 2.55 | |
Based on: 10-K (reporting date: 2016-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
Anadarko Petroleum Corp., historical price multiples
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
The valuation multiples for the period between 2012 and 2016 exhibit significant volatility, characterized by a general contraction in revenue and operating profit multiples through 2015, followed by a sharp expansion in asset-based and sales-based valuation in 2016.
- Earnings and Operating Profit Multiples
- The Price to Earnings (P/E) ratio experienced a substantial increase from 17.61 in 2012 to 52.93 in 2013, though subsequent figures are unavailable. Similarly, the Price to Operating Profit (P/OP) ratio rose slightly to 12.72 in 2013 before declining to 8.01 by 2014, indicating a reduction in the market premium attributed to the company's operating performance during that interval.
- Revenue Valuation
- The Price to Sales (P/S) ratio followed a consistent downward trajectory from 3.16 in 2012 to a low of 2.17 in 2015. This trend reversed abruptly in 2016, with the ratio surging to 4.42, the highest level recorded in the analyzed period.
- Book Value Valuation
- The Price to Book Value (P/BV) ratio remained relatively stable between 1.61 and 2.19 from 2012 through 2015. In 2016, a significant increase was observed, with the ratio reaching 3.06, suggesting a substantial increase in market valuation relative to the company's net asset value.
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Price to Earnings (P/E)
Anadarko Petroleum Corp., historical P/E calculation, comparison to benchmarks
| Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 558,979,551 | 508,438,647 | 506,650,285 | 503,767,298 | 500,565,966 | |
| Selected Financial Data (US$) | ||||||
| Net income (loss) attributable to common stockholders (in millions) | (3,071) | (6,692) | (1,750) | 801) | 2,391) | |
| Earnings per share (EPS)2 | -5.49 | -13.16 | -3.45 | 1.59 | 4.78 | |
| Share price1, 3 | 66.77 | 40.50 | 85.45 | 84.16 | 84.13 | |
| Valuation Ratio | ||||||
| P/E ratio4 | — | — | — | 52.93 | 17.61 | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Chevron Corp. | — | — | — | — | — | |
| ConocoPhillips | — | — | — | — | — | |
| Exxon Mobil Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
1 Data adjusted for splits and stock dividends.
2 2016 Calculation
EPS = Net income (loss) attributable to common stockholders ÷ No. shares of common stock outstanding
= -3,071,000,000 ÷ 558,979,551 = -5.49
3 Closing price as at the filing date of Anadarko Petroleum Corp. Annual Report.
4 2016 Calculation
P/E ratio = Share price ÷ EPS
= 66.77 ÷ -5.49 = —
5 Click competitor name to see calculations.
The financial performance between 2012 and 2016 is characterized by a severe deterioration in profitability and a subsequent volatility in market valuation. While the share price remained stable in the early part of the period, earnings experienced a precipitous decline, shifting from positive returns to significant net losses, which rendered traditional valuation multiples inapplicable in the later years.
- Earnings per Share (EPS)
- A sharp downward trajectory is observed in earnings per share, which fell from 4.78 in 2012 to 1.59 in 2013. This decline accelerated into negative territory starting in 2014 with an EPS of -3.45, reaching a low of -13.16 in 2015. A partial recovery began in 2016, with losses narrowing to -5.49.
- Price to Earnings (P/E) Ratio
- The P/E ratio expanded significantly from 17.61 in 2012 to 52.93 in 2013. This increase was not the result of share price growth, as the price remained nearly flat, but was instead driven by the substantial contraction in earnings. From 2014 through 2016, the P/E ratio is unavailable because the company reported negative earnings.
- Share Price Correlation
- The share price exhibited a lagged response to earnings declines, maintaining a range between 84.13 and 85.45 from 2012 to 2014. A significant correction occurred in 2015, where the price dropped to 40.50, coinciding with the peak in losses. By 2016, the share price recovered to 66.77, reflecting a positive market response to the reduction in net losses.
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Price to Operating Profit (P/OP)
Anadarko Petroleum Corp., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 558,979,551 | 508,438,647 | 506,650,285 | 503,767,298 | 500,565,966 | |
| Selected Financial Data (US$) | ||||||
| Operating income (loss) (in millions) | (2,599) | (8,809) | 5,403) | 3,333) | 3,727) | |
| Operating profit per share2 | -4.65 | -17.33 | 10.66 | 6.62 | 7.45 | |
| Share price1, 3 | 66.77 | 40.50 | 85.45 | 84.16 | 84.13 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | — | — | 8.01 | 12.72 | 11.30 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Chevron Corp. | — | — | — | — | — | |
| ConocoPhillips | — | — | — | — | — | |
| Exxon Mobil Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
1 Data adjusted for splits and stock dividends.
2 2016 Calculation
Operating profit per share = Operating income (loss) ÷ No. shares of common stock outstanding
= -2,599,000,000 ÷ 558,979,551 = -4.65
3 Closing price as at the filing date of Anadarko Petroleum Corp. Annual Report.
4 2016 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 66.77 ÷ -4.65 = —
5 Click competitor name to see calculations.
Between 2012 and 2016, the financial performance exhibited significant volatility, characterized by a transition from stable valuation multiples to substantial operating losses. While the initial three-year period showed relative stability in share pricing, the subsequent years were marked by severe profit contraction and high price variability.
- Share Price Trends
- The share price remained relatively stagnant from 2012 through 2014, fluctuating minimally between 84.13 US$ and 85.45 US$. A sharp devaluation occurred in 2015, where the price fell to 40.50 US$. This was followed by a partial recovery in 2016, with the price increasing to 66.77 US$.
- Operating Profit per Share Performance
- Operating profit per share showed a peak of 10.66 US$ in 2014 following a slight decrease in 2013. This positive trend reversed abruptly in 2015, resulting in a significant operating loss of 17.33 US$ per share. While the operating loss improved in 2016 to 4.65 US$ per share, the company failed to return to profitability within the observed period.
- Price to Operating Profit (P/OP) Ratio Analysis
- The P/OP ratio rose from 11.30 in 2012 to 12.72 in 2013, before decreasing to 8.01 in 2014. The reduction in 2014 was primarily driven by the increase in operating profit per share relative to a nearly flat share price. For the years 2015 and 2016, the P/OP ratio is absent, as the negative operating profit per share renders the multiple mathematically non-meaningful for valuation purposes.
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Price to Sales (P/S)
Anadarko Petroleum Corp., historical P/S calculation, comparison to benchmarks
| Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 558,979,551 | 508,438,647 | 506,650,285 | 503,767,298 | 500,565,966 | |
| Selected Financial Data (US$) | ||||||
| Sales revenues (in millions) | 8,447) | 9,486) | 16,375) | 14,867) | 13,307) | |
| Sales per share2 | 15.11 | 18.66 | 32.32 | 29.51 | 26.58 | |
| Share price1, 3 | 66.77 | 40.50 | 85.45 | 84.16 | 84.13 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 4.42 | 2.17 | 2.64 | 2.85 | 3.16 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Chevron Corp. | — | — | — | — | — | |
| ConocoPhillips | — | — | — | — | — | |
| Exxon Mobil Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
1 Data adjusted for splits and stock dividends.
2 2016 Calculation
Sales per share = Sales revenues ÷ No. shares of common stock outstanding
= 8,447,000,000 ÷ 558,979,551 = 15.11
3 Closing price as at the filing date of Anadarko Petroleum Corp. Annual Report.
4 2016 Calculation
P/S ratio = Share price ÷ Sales per share
= 66.77 ÷ 15.11 = 4.42
5 Click competitor name to see calculations.
An analysis of the valuation multiples between 2012 and 2016 reveals a period of gradual ratio compression followed by a significant divergence between market price and revenue generation.
- Price to Sales Ratio Trend (2012–2015)
- A consistent downward trend in the P/S ratio is observed from 2012 to 2015, declining from 3.16 to 2.17. Between 2012 and 2014, this compression was driven by rising sales per share, which increased from 26.58 to 32.32 while the share price remained relatively stagnant. In 2015, the ratio continued to fall despite a sharp decline in both share price and sales per share, indicating that the market valuation contracted more significantly than the underlying revenue.
- Valuation Divergence (2016)
- A sharp reversal occurred in 2016, where the P/S ratio increased to 4.42, the highest level in the analyzed period. This spike was characterized by a decoupling of price and performance; the share price recovered to 66.77, while sales per share continued to deteriorate, falling to 15.11. This suggests a significant expansion in the valuation multiple, with the market assigning a higher premium to each dollar of sales despite a continuing decline in revenue per share.
- Revenue and Price Correlation
- The data indicates an inverse relationship between sales per share and the P/S ratio in the final year of the period. While the initial years showed a valuation based on growing sales, the 2016 peak in the P/S ratio occurred amidst a four-year low in sales per share, reflecting a shift in investor valuation drivers or market expectations independent of immediate revenue results.
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Price to Book Value (P/BV)
Anadarko Petroleum Corp., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | Dec 31, 2012 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 558,979,551 | 508,438,647 | 506,650,285 | 503,767,298 | 500,565,966 | |
| Selected Financial Data (US$) | ||||||
| Stockholders’ equity (in millions) | 12,212) | 12,819) | 19,725) | 21,857) | 20,629) | |
| Book value per share (BVPS)2 | 21.85 | 25.21 | 38.93 | 43.39 | 41.21 | |
| Share price1, 3 | 66.77 | 40.50 | 85.45 | 84.16 | 84.13 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 3.06 | 1.61 | 2.19 | 1.94 | 2.04 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Chevron Corp. | — | — | — | — | — | |
| ConocoPhillips | — | — | — | — | — | |
| Exxon Mobil Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).
1 Data adjusted for splits and stock dividends.
2 2016 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= 12,212,000,000 ÷ 558,979,551 = 21.85
3 Closing price as at the filing date of Anadarko Petroleum Corp. Annual Report.
4 2016 Calculation
P/BV ratio = Share price ÷ BVPS
= 66.77 ÷ 21.85 = 3.06
5 Click competitor name to see calculations.
The financial valuation metrics between 2012 and 2016 exhibit significant volatility, characterized by a sharp contraction in both market price and book value in 2015, followed by a divergent recovery in 2016. While the market valuation experienced a partial rebound in the final year, the underlying book value continued a multi-year decline.
- Share Price Performance
- The market price remained stable between 2012 and 2014, fluctuating minimally between 84.13 and 85.45 US$. A substantial devaluation occurred in 2015, where the price dropped to 40.50 US$, representing a decline of approximately 52.6% from the previous year. By 2016, a recovery was observed as the price rose to 66.77 US$.
- Book Value Per Share (BVPS) Trends
- The book value per share peaked in 2013 at 43.39 US$ before entering a consistent downward trajectory. From 2013 to 2016, the BVPS declined every consecutive year, falling to 38.93 US$ in 2014, 25.21 US$ in 2015, and reaching a period low of 21.85 US$ by the end of 2016. This indicates a steady erosion of the equity base per share over the analyzed period.
- Price to Book Value (P/BV) Interpretation
- The P/BV ratio remained relatively stable between 1.94 and 2.19 from 2012 through 2014. In 2015, the ratio contracted to 1.61, reflecting a market correction that outweighed the decline in book value. However, 2016 saw a significant spike in the ratio to 3.06. This increase was driven by the fact that the share price recovered more aggressively than the book value, which continued to diminish, resulting in the highest valuation multiple of the five-year period.
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