2023, EBITDA and Normalized Earnings - Business Valuation Zone

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2023

EBITDA

Normalized Earnings

The 2023 AICPA Business Valuation Conference and One Thought on Valuation Adjustments

Chris Mercer

NOVEMBER 15, 2022

Assume a company has reported an EBITDA of $2.0 Assume further that the appropriate EBITDA multiple is 6x and that the underlying equity discount rate is 14%. Then, based on reported EBITDA, the company is worth $12.0 Normalized EBITDA is, therefore, $3.0 million based on normalized EBITDA.

Business Valuation

Business Valuation Normalized Earnings EBITDA Appraisal

What a Difference a Year Can Make

Class VI Partner

NOVEMBER 14, 2022

Average EBITDA multiples have consequently dropped in comparison to last year’s frenzied M&A period. Many private equity groups have pointed to their challenges in determining what they consider to be true normalized earnings, given the unique business elements of the last couple of years, both positive and negative.

Equity

Equity Normalized Earnings Finance EBITDA

The 2023 AICPA Business Valuation Conference and One Thought on Valuation Adjustments

What a Difference a Year Can Make

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