Can we finally put to bed the quaint notion that the stock market is even remotely a barometer of the value of a firm based upon its revenues, profits, growth, and risk-return fundamentals? The newest meme stock is AMC Entertainment. You know, the movie theater chain that in the wake of COVID posted more than $1.8B in losses? The company whose future is very much unclear now that the likes of Netflix, Amazon, Hulu, HBO Max, Disney, and others have made first run premiers at home a thing? Yeah, that AMC.
On January 30th, 2018, the Wall Street Journal reported the formation of what would later be called Haven under the headline, Triple Threat: Amazon, Berkshire, JPMorgan Rattle Health-Care Firms “The companies said the venture would be “free from proﬁt-making incentives and constraints” and would develop technological solutions to provide simpliﬁed, high quality health care for their hundreds of thousands of U.S. workers, but they oﬀered few other details [emphasis – and foreshadowing – added]” .
How many times have we been here? It’s only been a year since We Work was valued at $47 billion, only to see its value crash land 70% in just 30 days. Now we have DoorDash, one of the companies that won the pandemic. Check out this madness.
While buyers likely will be viewing the marketplace through the lens of the COVID-19 pandemic until the midpoint of the year, a confluence of factors has the Braff Group, the mergers and acquisitions firm that specializes in healthcare services, feeling bullish about market activity in 2021, president...
The home-based health care sector is among the strongest in health care causing swings, with hospice providers representing 70% of the bulk of acquisition targets in that sector. Find out what more Dexter Braff had to say about this hot topic!
If you’re in the predictions game and you’re paying attention, you can see that just off in the distance several factors are lining up perfectly to collide in 2021 to propel valuations.
“Hospice is an attractive acquisition opportunity for someone who has a long-term hold as well as somebody who has a short-term hold,” Dexter Braff told Hospice News.
Good question. Glad we asked it. No doubt this is a fluid situation. In fact, given what has transpired in just the past week, our answer today could very well go back to the future in 30 days or so (more on that below). But right now? There is evidence – mostly anecdotal at this point – that the M&A world is beginning to awaken from the Big Sleep.
Last summer, we noticed a peculiarly interesting article about what had become a runaway lending environment. Debt capacity had risen as high as 6-7 times EBITDA. What’s more, EBITDA was fast becoming a proforma, go-forward, if-everything-goes-perfect figure. In other words, a substantially puffed up version of the truth that effectively added another 1-2 turns of EBITDA that lenders were willing to put up.
Remember the run-up to the global recession when lenders were tripping over themselves to get in on a mergers and acquisitions climate that was positively giddy? When debt capacity, typically expressed as a multiple of a company’s earnings before interest, taxes, depreciation, and amortization reached milestone levels, eclipsing the “6X barrier” (as coined by PitchBook)? When the term “covenant-lite”, describing loan agreements with fewer protective covenants for the buyer and less restrictions for borrowers, became a thing?