Latest multiples for the healthcare services sector

BVWireIssue #158-2
November 11, 2015

The S&P Healthcare Services Index has declined 3.9% over the last three months, but it has continued to outperform the S&P 500, which declined 6.9% over the same period, according to the October 2015 Healthcare Sector Update from Duff & Phelps. The best-performing sectors were other services (up 14.6%), home care/hospice (up 1.1%), and physician practice management (up 0.8%). The worst-performing sectors were assisted living (down 26.0%), diagnostic imaging (down 24.0%), and clinical laboratories (down 22.0%).

The current median LTM revenue and LTM EBITDA multiples for the healthcare services industry overall are 1.53x and 12.5x, respectively. The sectors with the highest valuation multiples include: other services (2.78x LTM revenue, 28.5x LTM EBITDA), healthcare REITs (11.84x LTM revenue, 17.0x LTM EBITDA), and emergency services (3.19x LTM revenue, 23.4x LTM EBITDA).

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