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
Paramount Global, current price multiples
| Paramount Global | Alphabet Inc. | Comcast Corp. | Meta Platforms Inc. | Netflix Inc. | Walt Disney Co. | Media & Entertainment | Communication Services | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||
| Current share price (P) | $16.40 | ||||||||||
| No. shares of common stock outstanding | 651,557,231 | ||||||||||
| Growth rate (g) | 17.42% | ||||||||||
| Earnings per share (EPS) | $1.61 | ||||||||||
| Next year expected EPS | $1.89 | ||||||||||
| Operating profit per share | $3.59 | ||||||||||
| Sales per share | $46.28 | ||||||||||
| Book value per share (BVPS) | $35.36 | ||||||||||
| Valuation Ratios (Price Multiples) | |||||||||||
| Price to earnings (P/E) | 10.22 | 26.21 | 4.43 | 25.58 | 24.52 | 16.32 | 57.92 | 54.62 | |||
| Price to next year expected earnings | 8.70 | 20.48 | 3.98 | 20.19 | 18.65 | 16.05 | 48.48 | 48.02 | |||
| Price-earnings-growth (PEG) | 0.59 | 0.94 | 0.39 | 0.96 | 0.78 | 9.91 | 2.98 | 3.98 | |||
| Price to operating profit (P/OP) | 4.56 | 26.84 | 4.29 | 18.57 | 20.20 | 15.55 | 42.85 | 37.43 | |||
| Price to sales (P/S) | 0.35 | 8.60 | 0.72 | 7.70 | 5.96 | 2.14 | 8.77 | 6.25 | |||
| Price to book value (P/BV) | 0.46 | 8.34 | 0.91 | 7.12 | 10.11 | 1.84 | 9.63 | 7.26 | |||
Based on: 10-K (reporting date: 2022-12-31).
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)
Paramount Global, historical price multiples
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
The valuation multiples exhibit significant volatility over the five-year period from 2018 to 2022, characterized by inconsistent earnings multiples and a pronounced contraction in asset and revenue-based valuations.
- Earnings and Operating Profit Multiples
- The Price to Earnings (P/E) and Price to Operating Profit (P/OP) ratios demonstrate a cyclical and erratic pattern. The P/E ratio fluctuated from 9.64 in 2018 to a peak of 16.78 in 2020, before dropping to 5.19 in 2021 and recovering to 14.61 by the end of 2022. Similarly, the P/OP ratio peaked in 2020 at 9.82 and reached its lowest point in 2021 at 3.71. This volatility suggests inconsistent market sentiment regarding future profitability or significant shifts in the underlying earnings base.
- Revenue Valuation
- The Price to Sales (P/S) ratio reveals a general long-term decline. After an initial drop in 2019 and a spike to 1.61 in 2020, the ratio trended downward to 0.51 by 2022. This downward trajectory indicates that the market is assigning progressively lower value to each unit of revenue generated by the entity.
- Book Value Valuation
- A substantial contraction is observed in the Price to Book Value (P/BV) ratio. Starting at a premium of 6.74 in 2018, the multiple declined sharply over the period, ending at 0.66 in 2022. The transition from a high premium to a value below 1.0 suggests that the market valuation of the equity has fallen below the accounting value of its net assets.
In summary, while earnings-based multiples show periodic recovery, the revenue and book value multiples indicate a systemic devaluation of the company's market position and asset base over the analyzed timeframe.
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Price to Earnings (P/E)
Paramount Global, historical P/E calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 650,516,853 | 648,584,674 | 619,606,133 | 613,739,990 | 372,969,983 | |
| Selected Financial Data (US$) | ||||||
| Net earnings attributable to Paramount common stock (in millions) | 1,046) | 4,499) | 2,422) | 3,308) | 1,960) | |
| Earnings per share (EPS)2 | 1.61 | 6.94 | 3.91 | 5.39 | 5.26 | |
| Share price1, 3 | 23.50 | 35.99 | 65.60 | 29.29 | 50.64 | |
| Valuation Ratio | ||||||
| P/E ratio4 | 14.61 | 5.19 | 16.78 | 5.43 | 9.64 | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Alphabet Inc. | 22.47 | 25.74 | — | — | — | |
| Comcast Corp. | 31.38 | 16.01 | — | — | — | |
| Meta Platforms Inc. | 21.10 | 16.44 | — | — | — | |
| Netflix Inc. | 36.18 | 33.56 | — | — | — | |
| Walt Disney Co. | 54.90 | 137.89 | — | — | — | |
| P/E Ratio, Sector | ||||||
| Media & Entertainment | 24.34 | 23.98 | — | — | — | |
| P/E Ratio, Industry | ||||||
| Communication Services | 25.39 | 21.07 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
EPS = Net earnings attributable to Paramount common stock ÷ No. shares of common stock outstanding
= 1,046,000,000 ÷ 650,516,853 = 1.61
3 Closing price as at the filing date of Paramount Global Annual Report.
4 2022 Calculation
P/E ratio = Share price ÷ EPS
= 23.50 ÷ 1.61 = 14.61
5 Click competitor name to see calculations.
The valuation profile between 2018 and 2022 is characterized by high volatility in both market pricing and fundamental earnings, leading to inconsistent price-to-earnings (P/E) multiples.
- Share Price Trends
- The share price experienced significant fluctuations, peaking at 65.60 US$ in 2020 before entering a sustained decline to 23.50 US$ by the end of 2022. This trajectory indicates a substantial reduction in market valuation following the 2020 high.
- Earnings Per Share (EPS) Performance
- Earnings remained relatively stable through 2019, followed by a moderate decline in 2020 and a peak of 6.94 US$ in 2021. However, 2022 witnessed a severe contraction in profitability, with EPS falling to 1.61 US$, marking the lowest earnings level within the analyzed period.
- Price-to-Earnings (P/E) Ratio Analysis
- The P/E ratio displayed an erratic pattern of expansion and compression. A significant expansion occurred in 2020, reaching 16.78, driven by a spike in share price that occurred despite declining earnings. In contrast, 2021 saw a compression to 5.19 as earnings peaked while the share price declined. By 2022, the ratio rose to 14.61; this increase was not a result of price appreciation, but rather a consequence of the sharp collapse in EPS outpacing the decline in the share price.
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Price to Operating Profit (P/OP)
Paramount Global, historical P/OP calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 650,516,853 | 648,584,674 | 619,606,133 | 613,739,990 | 372,969,983 | |
| Selected Financial Data (US$) | ||||||
| Operating income (in millions) | 2,342) | 6,297) | 4,139) | 4,273) | 2,768) | |
| Operating profit per share2 | 3.60 | 9.71 | 6.68 | 6.96 | 7.42 | |
| Share price1, 3 | 23.50 | 35.99 | 65.60 | 29.29 | 50.64 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | 6.53 | 3.71 | 9.82 | 4.21 | 6.82 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Alphabet Inc. | 18.01 | 24.86 | — | — | — | |
| Comcast Corp. | 12.00 | 10.89 | — | — | — | |
| Meta Platforms Inc. | 16.91 | 13.84 | — | — | — | |
| Netflix Inc. | 28.85 | 27.71 | — | — | — | |
| Walt Disney Co. | 26.43 | 91.54 | — | — | — | |
| P/OP Ratio, Sector | ||||||
| Media & Entertainment | 18.01 | 21.08 | — | — | — | |
| P/OP Ratio, Industry | ||||||
| Communication Services | 17.40 | 17.55 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 2,342,000,000 ÷ 650,516,853 = 3.60
3 Closing price as at the filing date of Paramount Global Annual Report.
4 2022 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 23.50 ÷ 3.60 = 6.53
5 Click competitor name to see calculations.
The Price to Operating Profit (P/OP) ratio exhibited significant volatility between 2018 and 2022, characterized by a lack of linear correlation between market price and operational earnings.
- Valuation Extremes
- The P/OP ratio reached a peak of 9.82 in 2020, driven primarily by a surge in the share price to 65.60 despite a marginal decline in operating profit per share to 6.68. The ratio subsequently dropped to its lowest level of 3.71 in 2021, as operating profit per share climbed to a period high of 9.71 while the share price retracted to 35.99.
- Operating Performance Trends
- Operating profit per share demonstrated moderate stability from 2018 to 2020 before peaking in 2021. A severe contraction occurred in 2022, with operating profit per share falling to 3.60, the lowest recorded value in the five-year period.
- Equity Price Volatility
- The share price experienced sharp fluctuations, peaking in 2020 and declining steadily thereafter to end at 23.50 in 2022. This downward trajectory in market valuation contributed to the shifting multiples observed in the P/OP ratio.
- Period-End Convergence
- By 2022, the P/OP ratio stabilized at 6.53, a figure closely mirroring the 6.82 ratio observed in 2018. This suggests a return to previous valuation multiples, although the underlying fundamentals—both share price and operating profit per share—were substantially lower than their 2018 levels.
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Price to Sales (P/S)
Paramount Global, historical P/S calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 650,516,853 | 648,584,674 | 619,606,133 | 613,739,990 | 372,969,983 | |
| Selected Financial Data (US$) | ||||||
| Revenues (in millions) | 30,154) | 28,586) | 25,285) | 27,812) | 14,514) | |
| Sales per share2 | 46.35 | 44.07 | 40.81 | 45.32 | 38.91 | |
| Share price1, 3 | 23.50 | 35.99 | 65.60 | 29.29 | 50.64 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 0.51 | 0.82 | 1.61 | 0.65 | 1.30 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Alphabet Inc. | 4.76 | 7.60 | — | — | — | |
| Comcast Corp. | 1.39 | 1.95 | — | — | — | |
| Meta Platforms Inc. | 4.20 | 5.49 | — | — | — | |
| Netflix Inc. | 5.14 | 5.78 | — | — | — | |
| Walt Disney Co. | 2.09 | 4.08 | 4.13 | — | — | |
| P/S Ratio, Sector | ||||||
| Media & Entertainment | 3.68 | 5.56 | — | — | — | |
| P/S Ratio, Industry | ||||||
| Communication Services | 2.91 | 3.94 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= 30,154,000,000 ÷ 650,516,853 = 46.35
3 Closing price as at the filing date of Paramount Global Annual Report.
4 2022 Calculation
P/S ratio = Share price ÷ Sales per share
= 23.50 ÷ 46.35 = 0.51
5 Click competitor name to see calculations.
The financial metrics from 2018 to 2022 reveal a significant divergence between revenue generation per share and the market's valuation of those revenues. While sales per share maintained a generally positive trajectory, the Price-to-Sales (P/S) ratio experienced substantial volatility and an overall downward trend, indicating a contraction in market valuation multiples over the five-year period.
- Share Price Volatility
- The share price exhibited extreme fluctuations, starting at 50.64 USD in 2018, dropping to 29.29 USD in 2019, and peaking at 65.60 USD in 2020. Following this peak, a consistent decline occurred, ending the period at a five-year low of 23.50 USD in 2022.
- Sales per Share Performance
- Sales per share demonstrated relative stability with a modest growth trend. After an initial increase from 38.91 USD in 2018 to 45.32 USD in 2019, a slight dip to 40.81 USD occurred in 2020. However, revenue efficiency recovered and grew steadily thereafter, reaching 46.35 USD by December 31, 2022, representing an approximate 19% increase over the total period.
- Price-to-Sales Ratio Trends
- The P/S ratio mirrored the volatility of the share price more closely than the sales performance. The ratio fell from 1.30 in 2018 to 0.65 in 2019, before spiking to a period high of 1.61 in 2020. Subsequently, the ratio declined sharply to 0.82 in 2021 and reached a period low of 0.51 by 2022.
The analysis indicates that the decline in the P/S ratio was not driven by a failure to generate sales, as sales per share actually increased over the period. Instead, the contraction from a peak of 1.61 to 0.51 suggests a fundamental shift in market sentiment or a decrease in the premium investors were willing to pay for the company's revenue stream.
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Price to Book Value (P/BV)
Paramount Global, historical P/BV calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 650,516,853 | 648,584,674 | 619,606,133 | 613,739,990 | 372,969,983 | |
| Selected Financial Data (US$) | ||||||
| Total Paramount stockholders’ equity (in millions) | 23,036) | 22,402) | 15,371) | 13,207) | 2,804) | |
| Book value per share (BVPS)2 | 35.41 | 34.54 | 24.81 | 21.52 | 7.52 | |
| Share price1, 3 | 23.50 | 35.99 | 65.60 | 29.29 | 50.64 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 0.66 | 1.04 | 2.64 | 1.36 | 6.74 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Alphabet Inc. | 5.26 | 7.78 | — | — | — | |
| Comcast Corp. | 2.08 | 2.36 | — | — | — | |
| Meta Platforms Inc. | 3.89 | 5.18 | — | — | — | |
| Netflix Inc. | 7.82 | 10.83 | — | — | — | |
| Walt Disney Co. | 1.82 | 3.11 | 3.23 | — | — | |
| P/BV Ratio, Sector | ||||||
| Media & Entertainment | 4.05 | 5.68 | — | — | — | |
| P/BV Ratio, Industry | ||||||
| Communication Services | 3.38 | 4.28 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
BVPS = Total Paramount stockholders’ equity ÷ No. shares of common stock outstanding
= 23,036,000,000 ÷ 650,516,853 = 35.41
3 Closing price as at the filing date of Paramount Global Annual Report.
4 2022 Calculation
P/BV ratio = Share price ÷ BVPS
= 23.50 ÷ 35.41 = 0.66
5 Click competitor name to see calculations.
A significant divergence is observed between the growth of the company's book value and its market valuation between 2018 and 2022. While the intrinsic value per share grew consistently, the market multiple contracted sharply, resulting in a transition from a high-premium valuation to a discount relative to book value.
- Book Value per Share (BVPS) Trend
- A consistent upward trajectory is evident in the book value per share, which increased from 7.52 US$ in 2018 to 35.41 US$ by the end of 2022. This steady growth indicates a continuous strengthening of the company's net asset base over the five-year period.
- Share Price Volatility
- The share price exhibited substantial volatility, peaking at 65.60 US$ in 2020 before experiencing a sustained decline to 23.50 US$ in 2022. This downward pressure on the stock price occurred despite the simultaneous growth in the company's underlying book value.
- Price to Book Value (P/BV) Compression
- The P/BV ratio decreased from a high of 6.74 in 2018 to 0.66 in 2022. The ratio fell below the 1.0 threshold by the end of the period, signifying that the market valuation of the equity became lower than the accounting value of its net assets. This pattern suggests a diminishing market premium and a shift in investor sentiment regarding the company's valuation relative to its asset base.
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