Healthcare Services Sector Update – August 2020 M&A Advisory

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Healthcare Services Sector Update – August 2020

The S&P Healthcare Services Index increased by 2.5% over the last month, compared to the S&P 500 Index, which increased 7.0% over the same period.

Over the past month:

  • The sectors that experienced the most growth were Skilled Nursing (up 21.7%), Consumer Directed Health/Wellness (up 9.0%) and Home Health/Hospice (up 6.7%).
  • The sectors that experienced the largest declines were Healthcare Consulting (down 9.1%), Government Managed Care (down 4.6%) and Clinical Laboratories (down 4.2%).
  • The current average Last Twelve Months (LTM) revenue and LTM EBITDA multiples for the healthcare services industry overall are 1.89x and 10.5x, respectively

Healthcare Services Sector Update – August 2020

The sectors with the highest valuation multiples include:

  • HCIT (5.40x LTM revenue, 27.3x LTM EBITDA)
  • Hospital vendors (1.93x LTM revenue, 21.2x LTM EBITDA)
  • Contract research organizations (3.44x LTM revenue, 20.8x LTM EBITDA)
  • Home health/hospice (3.00x LTM revenue, 19.5x LTM EBITDA)
 
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