Fundamental analysis of Repsol
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Resumen
Over the last years, oil companies have been seeing how their businesses do not
go as well as they went years ago. The current competitiveness between the main producers of
petroleum and the high volatility of that commodity really difficult an accurate valuation.
Nevertheless, this paper tries to analyse by different ap- proaches the value of the Company
Repsol, which is considered as a reference in Spain
Free Cash Flow (FCF) and Multiples valuation are the two methods developed along the paper.
Regarding FCF, three different scenarios have been carried out in order to be as accurate as
possible. In this method, sales have been considered the starting point of each scenario, taking
into account correlations between Rep- sol’s sales and Brent quotation. According to Multiples, PER
and EV / EBITDA have been chosen as the referenced ratios to compare with the sector average peers.
Finally, once understood its performance and possible correlations, results are ob- tained.
Therefore, valuation takes place in order to observe whether the company is undervalued or
overvalued according current situation to the Spanish Index
IBEX-35 where Repsol is listed.
