Pitch me an LBO candidate - idea generation

To answer this question, I would look at it more as a question of do you know the fundamentals of an LBO. For what to look for in an LBO candidate, you want to select a target that has the following factors that are also important in an LBO:

1. Stable cashflow profile
   1. Typically these want to be more recurring, with a strong margin profile (incase you have margin depression for any reason) this is to make sure you can service the debt in the transaction
2. Pathway for growth (either through M&A, or Organic Growth)
   1. So often PE looks at the M&A since it is a fast way to accelerate growth given a standard 5 year underwriting period. In M&A as well there are often cost synergies that can be realized which can help the cashflow profile
   2. Organic growth can be cheaper, but often more variable results

For Private, vs Public targets, It really depends on the situation that you are in. Are you going to potentially be asked to pull additional information, Maybe go Public. For public targets, I would look for companies that are in fragmented spaces, that have has 5 years of good operating history but some slowdown in margin expansion or growth. 

If this is all more theoretical you, can talk through the industries that might have good cashflow profile. Something along the lines of "I would expect [Subsector] to have prime targets for a LBO strategy, due to the nature of strong margins and recent market tailwinds. Given the fragmentation of the market, this would also give the opportunity to do several add-ons to accelerate growth. Given any one individual target, diligence would need to be preformed to understand the risks of the business and make sure the debt is serviceable" 

Hope this helps.