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Private Equity Analyst Note: Exploring Buyout Multiples II

3Q 2017

Private Equity Analyst Note: Exploring Buyout Multiples II

September 12, 2017

Private Equity Analyst Note: Exploring Buyout Multiples II
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In the first installment of Exploring Buyout Multiples, we discussed the relationship between multiple expansion and private equity returns. To help private equity investors find opportunities for attractive entry pricing, which is paramount to achieving multiple expansion (and thus higher returns), we identified and examined three main sources of lower buyout multiples: smaller enterprise values, early stages of an economic expansion, and emerging markets.
 
In this edition, we examine two more:
  • Add-on strategies
  • Sector selection