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Q2 2024- Market Update: EBITDA Multiples Trend Upwards


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EBITDA Multiples Trend Upwards in Q2 2024


During the analyzed period, EBITDA multiples across all industries peaked at 5.0x in the third quarter of 2018. Since then, they have generally declined until the second quarter of 2022. Following this period, EBITDA multiples have been on an upward trend, reaching 4.3x in the first quarter of 2024.



Exhibit 1A; Median Selling Price/EBITDA With Trailing Three Quarter Average (Private Targets) line graph

EBITDA Margins Increase in 2022 and Continue Climbing in Q2 2024


EBITDA margins fell in the first quarter of 2022 but have been on an upward trajectory since, reaching 15% in the first quarter of 2024. They peaked at 18% in the first quarter of 2023 fueled by rising prices, and government support measures still working their way through the economy. Previously, from the first quarter of 2019 to the fourth quarter of 2021, EBITDA margins ranged between 11% and 15%. Notably, since the second quarter of 2018, EBITDA margins have consistently remained above 11%.


Exhibit 2. Median Selling Price/EBITDA With EBITDA Margins (Private Targets) line graph

All-Time Median EBITDA Multiple For All Sectors Is 4.1X


EBITDA multiples are highest in the information sector (17.6x) and the finance sector (9.8x). Conversely, the accommodation and food services sector (2.8x) and the entertainment sector (2.5x) remain under pressure and have the lowest EBITDA multiples. The median EBITDA multiple across all industries and time periods is 4.1x.


Notably, the information sector has experienced a significant recent increase, with its EBITDA multiple over the last 12 months rising to 17.6x compared to its all-time multiple of 11.0x.


Exhibit 3. Median Selling Price/EBITDA By Sector (Private Targets) line graph

Ten-Year Trend For Private-Seller Sector Multiples


Exhibit 10. Median Selling Price/EBITDA By Sector (Private Targets) line graph

Data source: DealStats Value Index (Q2 2024) - The DealStats Value Index summarizes valuation multiples and profit margins for private companies that were sold over the past several quarters. Business Valuation Resources (BVR) captures this private company transaction data in its DealStats platform.


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