Consumer Retail & Healthcare: What are the multiples?

Hi guys,

I am currently looking for multiples that are used by bankers in Consumer Retail & Healthcare (for instance, in tech bankers use EV/Pageviews).

Many thanks!!

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In theory, you're supposed to know EB/EBITDAR. In practice, I think EV/EBITDA is the most widely used still.

I can't speak for health care, but for consumer, 10-12x EBITDA is the average, with the majority of deals happening in the 10-11x space. If you get above 14x, you've got something special. If you drop below 8.5x, your client probably had some financial issues.

Additionally for consumer, I'd recommend knowing the following:

  • Average Unit Value: how much revenue does each store generate
  • Same Store Sales: As you compare revenue per year, eliminate the effect of opening new stores
  • Run Rate: What if all the stores that opened this year had opened on January 1st instead of throughout the year? How would this effect sales?
  • $ / MM ACV: For every million dollars the company sells, how much of it is made up of sales from x product?
 

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