Saudi Sale

 The Saudi Arabian Oil Company wants to sell 5% of itself to investors. The Saudis suggest the firm is worth $2 trillion, partly due its staggeringly large reserves. But, dividing free cash flow of $80 billion/year, which is where dividends come from, over market capitalization and assuming that rate is the average of the biggest oil firms, 6.5%, nets a valuation of $1.23 trillion at $65/bbl, the current price. Ouch.

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