Proprietary

MIDDLE MARKET

Database

Q4 2019

Valuations & Opinions Group

Connect with the Valuations & Opinions Group

Inside this Issue

Private equity backed portfolio company performance remains robust as market participants remain cautiously optimistic.

Click below to navigate to each page

  • Key Takeaways
  • Overview of Q4 2019 Database
  • Lincoln Middle Market Index
  • Middle Market Portfolio Company Performance
  • Enterprise Value and Leverage Multiples
  • Impact of EBITDA Adjustments
  • Quarterly New Issuances and M&A Transactions
  • Credit Market Environment
  • Distressed Assets
  • Valuations & Opinions Group Key Contacts

Enterprise Valuation & Leverage Multiple Evolution

The percentage of companies valued with a > 9.0x EV / EBITDA multiple climbed higher in Q4 2019, surpassing record highs in Q3 2019…

…while the percentage of companies with a > 12.0x EV / EBITDA multiple also reached new highs, nearly tripling since Q1 2017…

…and Business Services, Healthcare, and Technology industries continued to drive the multiple expansion.

Leverage decreased slightly across all size categories in Q4 2019 resulting in greater equity cushions, on average, while EV multiples ticked higher for companies with <$30 million of EBITDA

Note: Enterprise value as estimated by Lincoln; darker colors represent average leverage multiple, while lighter colors represent average enterprise value multiple

Cash flow rich industries of Business Services, Healthcare, and Technology have sustained EV multiples well above long-term historical averages; leverage remained relatively stable across industries, while declining by an average of 0.7x in Healthcare

Note: Enterprise value as estimated by Lincoln; darker colors represent average leverage multiple, while lighter colors represent average enterprise value multiple