Steel Industry specific multiples
Hi I am new to the WSO. I am sorry if this is not the correct forum to post this question in or if this has been answered in previous threads. I am doing an assignment that requires a relative valuation of a steel company and I was looking for some help on industry specific multiples.
Currently I am going to use EV/EBITDA, EV/EBIT and P/B, with weightings assigned according to each multiples appropriateness. I would also like to use some industry specific multiples. I was wondering if anyone could help me with providing some steel industry common multiples used and, if possible, where I might find some data?
Also FYI, I have outline my approach below if you would like to comment on it.
The company I am valuing is Bluescope Steel (ASX: BSL). I decided not use P/E or PEG ratio because of Bluescope's negative EPS over the last couple of years and because there does not seem to be stable EPS growth in the future. For comparable companies I am currently using Australian based companies in the material sector. However, I am concerned that not many of the comparables are heavily involved in the steel sector and as such have different risk profiles. I will try to find some non-AUS based companies to use as well.