IMA S.p.A. : relative valuation (historical market multiples).

With regard to the valuation, it is interesting to consider also its historical market multiples.

However, it needs to mark the following considerations :

• Every time period has its own market multiples, due to the macroeconomics factors and to the economic cycle ; in this way, the comparison term loses its value ; 

• The market anticipates the events and prices the expectations ; for this reason, the past valuations had always incorporated the whole scenarios ; the valuations and future market multiples are more important ; 

• Thirdly, with regard to the litterature, the relative valuation is composed always with a peer analysis, with a focus on the expectations of the sector (see the link, https://michelecarollo.blogspot.com/2018/11/ima-spa-relative-valuation.html). 

Here, we have the historical market multiple P/S. I used this market multiple with the aim to reduce the bias : the results at the top of the income statement are less influenced by several factors. 

We can notice that the last multiples are higher than the past multiples but we must consider the previous paragraphs, of course.

Then, the market valuation tends to assign higher multiples to a growing company, over time, like IMA S.p.A.

In this way, it is advisable to consider also a median of the multiple or a weighted average (the past prices are less important than the current prices). 

The expected market multiples (the yellow columnes) are substancially lower than the mean, median and weighted average (black and dashed lines in the chart). The gap is not so wide (that confirms the previous valuation).