• 5 hours Twitter-Shaming: The Biggest Threat To Any Business
  • 9 hours Canada Looks To Become A Major Source For Critical Minerals
  • 13 hours Hedge Funds Are Piling Into This Key Commodity
  • 2 days Trade Deal Not Likely Before Christmas 2020
  • 3 days America's $16 Trillion Debt Bubble Is About To Burst
  • 3 days Black Friday Breaks Online Shopping Records
  • 3 days Tesla's Biggest Competitor Is Hiding In Plain Sight
  • 4 days Are Celebrities Good Or Bad For Cannabis Stocks?
  • 5 days Venezuela’s Crisis Continues As Maduro Spends $5 Billion On Oil Deals
  • 6 days Elon Musk Claims 250,000 Orders For Cybertruck
  • 7 days How To Survive Thanksgiving Politics With Cannabis Gravy
  • 9 days The Fragility Of Monetary Policy
  • 9 days 5 Oligopoly Stock Picks For Your 2020 Portfolio
  • 9 days $7 Trillion In Unfunded U.S. Pensions As Domestic Debt Hits A Record High
  • 10 days Retail Is Alive And Well, But Only For The Rich
  • 10 days New Tech Could Unchain The Solar Revolution
  • 10 days China's Boldest Move Yet To Ditch The U.S. Dollar
  • 11 days 5 Stocks That Surpassed Earnings Expectations
  • 12 days Male Stress Increases With Female Earnings
  • 13 days Tesla Reveals Its New Cybertruck
Hedge Funds Are Piling Into This Key Commodity

Hedge Funds Are Piling Into This Key Commodity

Institutional investors are buying oil…

Oilprice.com

Oilprice.com

Writer, OilPrice.com

Information/Articles and Prices on a wide range of commodities: We have assembled a team of experienced writers to provide you with information on Crude Oil,…

Contact Author

  1. Home
  2. Investing
  3. Stocks

Even Banks Can't Answer Aramco's Trillion Dollar Question

Aramco Trillion Dollar Question

In what could be just days ahead of the most-anticipated initial public offering ever, investment banks continue to give enormous ranges in their low and high estimates of how much Saudi Arabia’s oil giant Aramco is really worth.  

Morgan Stanley is the latest bank to have put a massive US$1 trillion gap between the low and high estimates of Saudi Aramco, Bloomberg reported on Wednesday, citing a presentation it has seen.  

Bankers at Morgan Stanley have calculated that in the most bearish case, Aramco is worth US$1.06 trillion, while the highest estimate in the most bullish scenario is US$2 trillion. Morgan Stanley’s base case valuation stands at US$1.52 trillion—US$500 billion lower than what Crown Prince Mohammed bin Salman would have liked.

Nearly all banks have huge gaps in their low-end and high-end valuations. The valuations from 16 banks that have come up with estimates range from as low as US$1.1 trillion to as high as US$2.5 trillion, Bloomberg says, quoting people who have reviewed all estimates.  

The midpoint of the banks’ valuation is US$1.75 trillion. This could be enough to get the Crown Prince on board, despite the speculation that MbS has insisted on the US$2-trillion valuation he first mentioned when he announced plans for Aramco to go public more than three years ago.   Related: The Crushing Reality Of Poverty In America

The Saudis could be willing to compromise on the valuation and banks will now look to hit a valuation of US$1.6 trillion-US$1.8 trillion, Bloomberg reported earlier this month, citing people briefed on the issue.  

After years of delays, the world’s largest oil producer and the world’s most profitable company in any sector announced in early November its intention to proceed with an IPO on the Saudi stock market. But Aramco still needs to clear one very important hurdle—its valuation.

Aramco’s prospectus of 658 pages published this weekend was very scarce on details, too. The number of shares, the price and date of the listing remain shrouded in mystery, even after Saudi Aramco released its long-awaited IPO prospectus.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment