Healthcare Services Sector Update – December 2020 M&A Advisory

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Healthcare Services Sector Update – December 2020

The S&P Healthcare Services Index increased by 7.3% over the last month, compared to the S&P 500 Index, which increased 2.6% over the same period.

Over the past month, the sectors that experienced the most growth were Behavioral Health (up 24.8%), Providers –Other (up 17.1%) and Home Health/Hospice (up 12.2%). The sector that experienced the largest decline was Consumer Directed Health/Wellness (down 2.0%), Distribution (down 1.1%) and Clinical Laboratories (down 1.0%).

The current average Last Twelve Months (LTM) revenue and LTM EBITDA multiples for the healthcare services industry overall are 1.99x and 10.4x, respectively.

Healthcare Services Sector Update - December 2020

The sectors with the highest valuation multiples include:

  • HCIT (4.47x LTM revenue, 30.5x LTM EBITDA)

  • Contract Research Organizations (3.61x LTM revenue, 21.7x LTM EBITDA)

  • Home Health/Hospice (3.22x LTM revenue, 20.0x LTM EBITDA)

  • Consumer Directed Health/Wellness (2.92x LTM revenue, 18.5x LTM EBITDA)

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