Where can I compare a stock’s valuation multiples with its peers?

A stock may be undervalued if it trades at a lower forward valuation multiple than five to eight similar companies, and the difference can’t be explained by slower growth or lower profit margins. In about 15 minutes, you can compare these companies in a table, calculate the median valuation, and check how each stock’s current valuation compares with its own 10-year history. Before deciding a stock is cheap, also consider stock-based compensation, how margins change over time, and valuations in its home market.

What is a good valuation multiple compared with peers?

A stock’s valuation multiple may be attractive if it’s at or below the median of similar companies, after accounting for differences in profit margins, growth, and debt. What’s considered a good multiple varies by industry, so there’s no single number that works for every stock.

Many guides call an EV/EBITDA below about 10 healthy. The middle of the market is a bit higher, so treat 10 only as a starting point.

Here are the median forward valuation multiples for US companies with a market cap above $10 billion, based on Koyfin’s Screener data as of November 2, 2026:

For example, a drugmaker at 14x forward earnings is in line with its industry, even though it trades below the 19x of the broader market. Against the market alone, it would look cheap.

The comparison: four steps

1. Choose five to eight peers by their revenue sources

Choose peers that earn most of their revenue from the same customers and the same kind of product as the company you’re researching. Industry codes group companies by their largest segment, so a screen by industry is only a starting list.

For example, a screen for US and Canadian companies above $10 billion in “Ground Transportation” returns the five large railroads, along with Uber, DiDi, Grab, U-Haul and trucking companies. Only the railroads earn their revenue the same way, so they’re the peer group.

Open this screen in Koyfin

With fewer than five peers, one company can have a large effect on the median. More than ten usually means some companies are less comparable.

2. Use the multiple that fits how the business earns money

• EV/EBITDA: Use EV/EBITDA when peers carry different amounts of debt. Enterprise value accounts for debt and cash, while P/E rises and falls with leverage.
• EV/EBIT or price to free cash flow: Use these multiples when capital spending differs considerably between peers. EBITDA ignores the cost of replacing equipment and stores.
• P/E and price to tangible book: Compare banks and insurers using P/E and price to tangible book. Borrowing is part of their core business, so enterprise value has a different meaning.
• Price to FFO: Use price to FFO for REITs because depreciation on buildings understates their earnings.
• EV/Sales: Use EV/Sales only for peers with little or no profit, and compare their margins alongside it.

Use forward multiples (next 12 months) where analysts cover all the peers. They put every company on the same 12-month window and include news since the last report.

3. Compare with the median to limit the effect of outliers

One company with unusually high or low earnings can pull the average far from a typical peer. Your stock can then look cheap or expensive against a number that doesn’t represent the group.

For example, among eight large software companies, Datadog trades at about 60x forward EBITDA while the others are between 7x and 16x. Datadog alone lifts the average to 17.5x, while the median stays at 12.0x.

Exclude loss-making peers from the P/E comparison because negative multiples are unsuitable for it.

4. Explain the gap, then compare it with the stock’s own history

A higher operating margin or faster expected growth can justify a premium in the multiple. Higher debt (net debt above about 3x EBITDA) or reliance on a few customers justifies a discount.

Then compare today’s premium or discount with its 5- or 10-year average. A stock that has traded 15% below its peers for a decade isn’t cheap at 10% below them.

For example, among five large railroads, Norfolk Southern trades above the group’s median P/E even though it has the lowest margin and sits near the top of its own 10-year range. That premium is hard to explain. Canadian National trades below the median with one of the highest margins.

Tools to compare valuation multiples with peers

• Free stock comparison pages: Compare a few stocks side by side on price, valuation and financial metrics in Stock Analysis, Yahoo Finance (up to four stocks) or MarketBeat (up to ten).
• Screeners with industry figures: See each industry’s P/E, forward P/E, PEG, P/S and P/FCF on Finviz’s industry groups page, then compare them with a stock’s own ratios in its screener.
• Research platforms with peer tabs: TIKR groups a stock with industry peers by sector and market cap and compares their financials over up to 20 years.
• Professional comps software: Build full comparable-company tables with peer lists and Excel export in Capital IQ, FactSet or Bloomberg, the tools banks and valuation courses use.
• Koyfin: Build your own peer table with forward P/E, EV/EBITDA and margins for each peer in one list. Then see the median and where each multiple sits in its own 10-year range.

Where peer comparisons go wrong, and how to avoid it

High stock-based pay can make adjusted multiples look cheaper

The check: when you compare software, internet and biotech companies, include stock pay as a cost before ranking their multiples. Stock pay in these industries ranges from a few percent of revenue to over 20%.

Why adjusted multiples miss it: consensus EBITDA and adjusted EPS usually exclude stock pay. Shareholders bear the cost through dilution or the cash spent on buybacks to offset it.

For example, Salesforce looks cheaper than ServiceNow at 11x forward EBITDA against 16x. Count stock pay as a cost, and the gap roughly doubles: 14x against 24x. For companies with very high stock pay, such as Datadog, the multiple can nearly triple.

What to do: in Koyfin, add SBC % of Revenues to the peer watchlist next to EV/EBITDA (NTM). Then add a custom formula column: Enterprise Value divided by (consensus EBITDA for the next 12 months minus stock-based compensation for the last 12 months).

In a cyclical group, the lowest P/E usually belongs to the company nearest its peak margins

The check: for cyclical peers, compare each company’s current margin with its 10-year average before reading the multiple, and rank them on earnings at average margins.

Why the P/E misses it: in semiconductors, autos, homebuilders, chemicals and energy, margins swing far more than revenue. Investors value these companies using earnings at a typical point in the cycle. A low P/E can therefore reflect how far profits could fall.

For example, Micron has the lowest forward P/E of six large US chipmakers at about 5x, but its margins are more than three times their 10-year average. Intel has the highest P/E, at about 44x, with margins below average. Both multiples reflect where each company is in its cycle more than how cheap it is.

What to do: in a Koyfin watchlist, add the 10-year historical average of operating margin next to the current figure or plot one against the other in Market Scatter.

Foreign peers bring their home market’s discount into your median

The check: in pharma, semiconductors, autos and luxury goods, where the closest peers are often listed abroad, compare each peer’s multiple with its home market, or keep a separate median per country.

Why a mixed median misses it: interest rates, sector mix, buybacks and the investors in each market affect valuations across that market. A median that mixes countries can reflect these differences as much as differences between companies.

For example, European drugmakers look cheaper than US ones: 16.4x forward earnings against 18.2x. But European stocks overall trade at about 14x and US stocks at about 19x. Compared with their own markets, the European drugmakers are actually the more expensive group.

What to do: in Koyfin, group the watchlist by country or region so the median row shows for each group.

Then check each market’s forward P/E with a broad ETF such as SPY for the US, VGK for Europe or EWJ for Japan.

Build a peer table for your stock

To find peer candidates, filter Koyfin’s Screener by industry and size and save the results as a watchlist. Then keep the five to eight peers closest to your stock by revenue source.

Open this screen in Koyfin

In the watchlist, add the multiples from the Valuation columns (P/E, P/S and EV/EBITDA, forward and trailing) and a Median summary row. Then add each stock’s percentile rank against its own 10-year history and against its sector, to see where today’s multiple sits.

Create a free Koyfin account to build your peer table. New accounts get 7 days of full access.

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Common questions about comparing valuation multiples

Should I use the median or the average of peer multiples?

Use the median when you have five or more peers, because one company with unusually low earnings can distort the average. With fewer than five peers and no clear outliers, the average works too.

What are the downsides of comparing multiples with peers?

The whole peer group can be overpriced or underpriced at the same time, and a multiple doesn’t show why a company trades at a discount. Check the stock against its own history and the market as well.

Comparing peers in Koyfin

Can I see forward EV/EBITDA for a stock in Koyfin?

Yes, EV / EBITDA (NTM) uses consensus EBITDA estimates for the next 12 months. Add it as a column next to the trailing EV / EBITDA (LTM), and see its history by quarter in Financial Analysis > Multiples.

How do I read percentile rank in Koyfin?

Percentile rank shows where today’s value sits against the stock’s own 10- or 20-year history, or against its sector, country or region. For a valuation multiple, a rank of 90 means it’s higher than 90% of that history or group, so the stock is expensive by that measure.

Can I chart my peer group’s multiples over time?

Yes. Add each peer’s forward P/E or EV/EBITDA to one Koyfin graph to see how the gaps between them have changed.

Our insights are derived solely from historical information and analyst predictions, employing an impartial approach. Please note that our articles do not serve as financial guidance.