Hi Folks,
In times like we are living now, it is always a challenge for young investment bankers to understand on what "normalised" multiples a specific industry trades.
So, my idea with this thread is to get inputs from more experienced / senior bankers on what multiples the following industries generally trade at in normal times (removing any effect of financial crisis or cyclical factors).
Of course it is difficult to generalize, but I believe some experienced bankers out there have the "ability" to say or at least give us a guide on what are the multiples for these industries based on their experience and historicals...
P/E and EV/EBITDA, if possible, for the following industries:
FIG:
TMT:
Healthcare:
Real Estate:
Industrial:
Consumer Goods & Services:
Retail:
Natural Resources:
Infrastructure:
I appreciate your contribution.
Thanks guys!
P.S: this can also be a good source of info. for estimating Terminal Value based on the Exit Multiples method (where you have to use a non-cyclical multiple).
At the industry level you're not going to be able to set even general guidelines. For example, I'll speak to Healthcare.
The sector is very, very important. A home health company is going to be valued at very different multiples than a behavioral health company or a pharmaceutical company. Not only that, but the company's payor mix is going to vastly influence multiples. Does the company receive most of its revenue from Medicare, Medicaid, or private pay/insurance? Multiples can swing as much as 10x depending on these two factors alone.
~~~~~~~~~~~ CompBanker
Dear Lui
Just tell your boss/client that it doesn't matter what multiple you put on EBITDA of nothing. Anything times zero equals zero.
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