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
Twitter Inc., current price multiples
| Twitter Inc. | Alphabet Inc. | Comcast Corp. | Meta Platforms Inc. | Netflix Inc. | Take-Two Interactive Software Inc. | Walt Disney Co. | Media & Entertainment | Communication Services | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||||||||
| Current share price (P) | $39.34 | |||||||||||
| No. shares of common stock outstanding | 765,246,152 | |||||||||||
| Earnings per share (EPS) | $-0.29 | |||||||||||
| Operating profit per share | $-0.64 | |||||||||||
| Sales per share | $6.64 | |||||||||||
| Book value per share (BVPS) | $9.55 | |||||||||||
| Valuation Ratios (Price Multiples) | ||||||||||||
| Price to sales (P/S) | 5.93 | 6.05 | 1.06 | 11.10 | 14.26 | 7.54 | 2.39 | 8.26 | 5.67 | |||
| Price to book value (P/BV) | 4.12 | 6.51 | 1.54 | 10.00 | 22.48 | 19.86 | 2.17 | 8.43 | 6.16 | |||
Based on: 10-K (reporting date: 2021-12-31).
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)
Twitter Inc., historical price multiples
Based on: 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), 10-K (reporting date: 2017-12-31).
- Price to Earnings (P/E) Ratio
- The P/E ratio is available for the years 2018 and 2019, showing a slight increase from 19.57 in 2018 to 20.69 in 2019. This indicates a modest rise in the market valuation relative to earnings during this period. Data for other years is unavailable, limiting trend analysis beyond these years.
- Price to Operating Profit (P/OP) Ratio
- The P/OP ratio exhibits significant volatility over the observed period. It was extremely high at 633.05 in 2017, then decreased sharply to 52.03 in 2018 and subsequently rose again to 82.78 in 2019. A notable spike occurred in 2020, with the ratio escalating dramatically to 2149.42, suggesting a considerable drop in operating profit or sharp market valuation increase relative to operating profit. The data for 2021 is missing, which restricts further evaluation.
- Price to Sales (P/S) Ratio
- The P/S ratio demonstrates fluctuations across the years: starting at 10.04 in 2017, decreasing to 7.75 in 2018, then rising to 8.77 in 2019, followed by a substantial increase to 15.42 in 2020. In 2021, the ratio dropped markedly to 5.71. This pattern suggests fluctuating market valuations relative to sales revenue, with a peak in 2020 and a significant decrease thereafter.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio varied moderately over the period, starting at 4.86 in 2017 and declining steadily to around 3.47-3.48 in 2018 and 2019. In 2020, it increased sharply to 7.19, indicating a marked rise in market price relative to book value. By 2021, the ratio decreased again to 3.97, suggesting a partial correction or adjustment in market valuation relative to equity.
- Overall Trends and Insights
- The financial ratios reflect considerable volatility in market valuation metrics relative to earnings, operating profit, sales, and book value. The year 2020 stands out with particularly high valuation multiples, especially in P/OP and P/S ratios, potentially indicating market optimism or compressed profitability metrics during that year. The subsequent year, 2021, shows a general reduction in multiples, suggesting a reassessment of market value or improvements in operating profitability and sales. Missing data in some years prevents a full continuous trend analysis.
Price to Earnings (P/E)
Twitter Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 800,641,166 | 798,152,488 | 782,287,089 | 766,824,550 | 750,904,551 | |
| Selected Financial Data (US$) | ||||||
| Net income (loss) (in thousands) | (221,409) | (1,135,626) | 1,465,659) | 1,205,596) | (108,063) | |
| Earnings per share (EPS)2 | -0.28 | -1.42 | 1.87 | 1.57 | -0.14 | |
| Share price1, 3 | 36.24 | 71.79 | 38.77 | 30.76 | 32.66 | |
| Valuation Ratio | ||||||
| P/E ratio4 | — | — | 20.69 | 19.57 | — | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Alphabet Inc. | 25.74 | 34.65 | — | — | — | |
| Comcast Corp. | 16.01 | 22.37 | — | — | — | |
| Meta Platforms Inc. | 16.44 | 25.89 | — | — | — | |
| Netflix Inc. | 33.56 | 86.39 | — | — | — | |
| Take-Two Interactive Software Inc. | 35.22 | 39.58 | — | — | — | |
| Walt Disney Co. | 137.89 | — | 23.96 | — | — | |
| P/E Ratio, Sector | ||||||
| Media & Entertainment | 24.03 | 36.26 | — | — | — | |
| P/E Ratio, Industry | ||||||
| Communication Services | 21.12 | 36.52 | — | — | — | |
Based on: 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), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
EPS = Net income (loss) ÷ No. shares of common stock outstanding
= -221,409,000 ÷ 800,641,166 = -0.28
3 Closing price as at the filing date of Twitter Inc. Annual Report.
4 2021 Calculation
P/E ratio = Share price ÷ EPS
= 36.24 ÷ -0.28 = —
5 Click competitor name to see calculations.
The analysis of financial data over the five-year period reveals notable fluctuations in key metrics related to company valuation and profitability.
- Share Price Trends
- The share price displayed variability, starting at $32.66 at the end of 2017 and slightly declining to $30.76 by the end of 2018. It then experienced a moderate increase in 2019 to $38.77, followed by a significant rise to $71.79 in 2020. However, a subsequent decline occurred in 2021, with the share price falling to $36.24. This pattern suggests volatility, including a substantial peak in 2020.
- Earnings Per Share (EPS) Patterns
- The EPS showed considerable inconsistency over the period. Beginning with a negative value of -$0.14 in 2017, EPS turned positive in 2018, increasing to $1.57, and further improving to $1.87 in 2019, indicating improved profitability during those years. However, EPS reverted to negative figures in 2020 and 2021, with -$1.42 and -$0.28 respectively, indicating a return to losses and possible operational challenges or increased expenses during those later years.
- P/E Ratio Observations
- The price-to-earnings (P/E) ratio data is only available for 2018 and 2019. In 2018, the ratio was 19.57, increasing slightly to 20.69 in 2019. The absence of P/E values in other years is likely due to negative EPS figures, which typically prevent meaningful calculation of this ratio. The available P/E ratios during years with positive earnings suggest moderately high valuation relative to earnings.
Overall, the data reflects a cyclical pattern in profitability, with improvements in the middle years followed by a return to losses. Correspondingly, share price and valuation metrics exhibited considerable volatility, with notable peaks during years of positive earnings and declines aligned with negative earnings periods.
Price to Operating Profit (P/OP)
Twitter Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 800,641,166 | 798,152,488 | 782,287,089 | 766,824,550 | 750,904,551 | |
| Selected Financial Data (US$) | ||||||
| Income (loss) from operations (in thousands) | (492,739) | 26,658) | 366,373) | 453,325) | 38,740) | |
| Operating profit per share2 | -0.62 | 0.03 | 0.47 | 0.59 | 0.05 | |
| Share price1, 3 | 36.24 | 71.79 | 38.77 | 30.76 | 32.66 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | — | 2,149.42 | 82.78 | 52.03 | 633.05 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Alphabet Inc. | 24.86 | 33.85 | — | — | — | |
| Comcast Corp. | 10.89 | 13.47 | — | — | — | |
| Meta Platforms Inc. | 13.84 | 23.10 | — | — | — | |
| Netflix Inc. | 27.71 | 52.02 | — | — | — | |
| Take-Two Interactive Software Inc. | 32.96 | 37.65 | — | — | — | |
| Walt Disney Co. | 91.54 | — | 24.82 | — | — | |
| P/OP Ratio, Sector | ||||||
| Media & Entertainment | 21.13 | 30.81 | — | — | — | |
| P/OP Ratio, Industry | ||||||
| Communication Services | 17.59 | 25.65 | — | — | — | |
Based on: 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), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
Operating profit per share = Income (loss) from operations ÷ No. shares of common stock outstanding
= -492,739,000 ÷ 800,641,166 = -0.62
3 Closing price as at the filing date of Twitter Inc. Annual Report.
4 2021 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 36.24 ÷ -0.62 = —
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited fluctuations over the five-year period. Starting at $32.66 at the end of 2017, it showed a slight decline to $30.76 in 2018, followed by an increase to $38.77 in 2019. A significant surge occurred in 2020, reaching $71.79, before a sharp decrease to $36.24 in 2021. Overall, the share price displayed volatility with a notable peak in 2020.
- Operating Profit per Share
- Operating profit per share demonstrated variability and a decline toward the end of the period. It began at $0.05 in 2017, increased to a peak of $0.59 in 2018, then slightly decreased to $0.47 in 2019. A substantial drop to $0.03 occurred in 2020, followed by a negative value of -$0.62 in 2021, indicating operating losses in the final year observed.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio exhibited extreme volatility. It started at a very high value of 633.05 in 2017, substantially decreased to 52.03 in 2018, and rose again to 82.78 in 2019. There was an extraordinary spike in 2020 to 2149.42, reflecting the very low operating profit per share that year. Data for 2021 is unavailable, likely due to the negative operating profit per share making the ratio inapplicable.
Price to Sales (P/S)
Twitter Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 800,641,166 | 798,152,488 | 782,287,089 | 766,824,550 | 750,904,551 | |
| Selected Financial Data (US$) | ||||||
| Revenue (in thousands) | 5,077,482) | 3,716,349) | 3,459,329) | 3,042,359) | 2,443,299) | |
| Sales per share2 | 6.34 | 4.66 | 4.42 | 3.97 | 3.25 | |
| Share price1, 3 | 36.24 | 71.79 | 38.77 | 30.76 | 32.66 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 5.71 | 15.42 | 8.77 | 7.75 | 10.04 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Alphabet Inc. | 7.60 | 7.65 | — | — | — | |
| Comcast Corp. | 1.95 | 2.28 | — | — | — | |
| Meta Platforms Inc. | 5.49 | 8.78 | — | — | — | |
| Netflix Inc. | 5.78 | 9.54 | — | — | — | |
| Take-Two Interactive Software Inc. | 6.15 | 5.18 | — | — | — | |
| Walt Disney Co. | 4.08 | 4.13 | 3.81 | — | — | |
| P/S Ratio, Sector | ||||||
| Media & Entertainment | 5.57 | 6.25 | — | — | — | |
| P/S Ratio, Industry | ||||||
| Communication Services | 3.95 | 4.19 | — | — | — | |
Based on: 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), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
Sales per share = Revenue ÷ No. shares of common stock outstanding
= 5,077,482,000 ÷ 800,641,166 = 6.34
3 Closing price as at the filing date of Twitter Inc. Annual Report.
4 2021 Calculation
P/S ratio = Share price ÷ Sales per share
= 36.24 ÷ 6.34 = 5.71
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited volatility over the evaluated period. It started at $32.66 in 2017, decreased slightly to $30.76 in 2018, then increased significantly to a peak of $71.79 in 2020. However, in 2021, the share price declined sharply to $36.24, representing nearly a 50% drop from its 2020 high.
- Sales per Share
- Sales per share showed a steady upward trend throughout the five years. Beginning at $3.25 in 2017, sales per share increased each year, reaching $6.34 in 2021. This indicates consistent growth in revenue generation on a per-share basis, almost doubling over the period.
- Price-to-Sales (P/S) Ratio
- The P/S ratio experienced notable fluctuations, reflecting changes in market valuation relative to sales. It decreased from 10.04 in 2017 to a low of 7.75 in 2018, followed by a moderate increase to 8.77 in 2019. Subsequently, it surged notably to 15.42 in 2020, coinciding with the highest share price of the period. In 2021, the P/S ratio dropped sharply to 5.71, the lowest point within the timeframe, indicating the stock price relative to sales was lower despite sales per share growth.
- Overall Observations
- The data suggests that sales per share consistently improved, indicating operational growth. However, the market's valuation of the company, as reflected in the share price and P/S ratio, was more volatile. The peak in 2020 for share price and P/S ratio may align with external factors or investor optimism, followed by a substantial correction in 2021 despite ongoing sales growth. This divergence points to changing market sentiments or revaluation of the company’s growth prospects.
Price to Book Value (P/BV)
Twitter Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 800,641,166 | 798,152,488 | 782,287,089 | 766,824,550 | 750,904,551 | |
| Selected Financial Data (US$) | ||||||
| Stockholders’ equity (in thousands) | 7,307,199) | 7,970,082) | 8,704,386) | 6,805,594) | 5,047,218) | |
| Book value per share (BVPS)2 | 9.13 | 9.99 | 11.13 | 8.88 | 6.72 | |
| Share price1, 3 | 36.24 | 71.79 | 38.77 | 30.76 | 32.66 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 3.97 | 7.19 | 3.48 | 3.47 | 4.86 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Alphabet Inc. | 7.78 | 6.27 | — | — | — | |
| Comcast Corp. | 2.36 | 2.61 | — | — | — | |
| Meta Platforms Inc. | 5.18 | 5.88 | — | — | — | |
| Netflix Inc. | 10.83 | 21.56 | — | — | — | |
| Take-Two Interactive Software Inc. | 6.23 | 6.31 | — | — | — | |
| Walt Disney Co. | 3.11 | 3.23 | 2.98 | — | — | |
| P/BV Ratio, Sector | ||||||
| Media & Entertainment | 5.68 | 5.41 | — | — | — | |
| P/BV Ratio, Industry | ||||||
| Communication Services | 4.29 | 4.20 | — | — | — | |
Based on: 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), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
2 2021 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= 7,307,199,000 ÷ 800,641,166 = 9.13
3 Closing price as at the filing date of Twitter Inc. Annual Report.
4 2021 Calculation
P/BV ratio = Share price ÷ BVPS
= 36.24 ÷ 9.13 = 3.97
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited a fluctuating pattern over the observed periods. Initially, it decreased slightly from $32.66 in 2017 to $30.76 in 2018, then increased steadily to reach a peak of $71.79 in 2020, more than doubling from the 2018 level. However, this high was followed by a significant decline to $36.24 in 2021, marking a decrease of nearly 50% from the previous year.
- Book Value Per Share (BVPS)
- The book value per share showed a consistent upward trend from 2017 through 2019, rising from $6.72 to $11.13, indicating an improvement in the company’s net asset value per share during that period. After 2019, BVPS decreased to $9.99 in 2020 and further declined to $9.13 in 2021, showing some erosion in equity per share following the prior growth.
- Price to Book Value (P/BV) Ratio
- The P/BV ratio declined notably from 4.86 in 2017 to roughly 3.47-3.48 in 2018 and 2019, suggesting the market price relative to the book value per share was becoming more modest. In 2020, the ratio surged to 7.19, reflecting a substantial increase in market valuation relative to book value, likely driven by the sharp increase in share price. By 2021, the ratio decreased significantly to 3.97, consistent with the decline in share price and decreasing book value per share during that year.