Using Balance Sheet and Relative Valuation for Woodside Petroleum

Case Analysis Group

TABLE OF CONTENTS
MAIN BODY...................................................................................................................................3
B.......................................................................................................................................................3
Using the balance sheet and relative valuation and applying the price earnings ratio................3
C.......................................................................................................................................................3
Determining the Net Asset Valuation of the company...............................................................3
REFERENCES................................................................................................................................5

MAIN BODY
B
Using the balance sheet and relative valuation and applying the price earnings ratio
The relative valuation method is the one which assist in comparing the value of the
company with that of the other competitors in order to determine the financial worth of the
company. This is assistive in order to evaluate the value of whole company such that the
performance is being evaluated in better manner (Kumar, 2019). Also this will assist the
company in identifying the areas where they need improvement and how it can be undertaken.
under this method the use of price to earnings ratio. The price to earnings ratio is the one which
help the company in valuing the current share price which is relative to the EPS of the company.
P/ E ratio= Market value per share/ Earning per share
The market value per share= 32.07
Earnings per share (EPS)= 2.74
P/ E ratio = 32.07/ 2.74
Valuation of company on basis of P/ E is = $11.70
2021
net income 2642
depreciation+ amortization 2290
interest expense(1-t) 187.6
Capex -641.9
NWC 518
Free cash flow 4995.7
terminal value 99575.31
With respect to the average trailing P/ E ratio is 15x times for the Oil and Gas industry
within Australia. This simply implies that the valuation of the Woodside Petroleum is on an
average good as it is near to the industry average. In accordance to the P/ E ratio the performance
of the company is 11.70 and the industry average trailing P/ E is 15 which is somewhat near.
Thus it is very important for the company to analyse and compare its performance with the
competitor so that the deviation in performance can be outlined and improvement can be done in