Can today’s multiples withstand a downturn?
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Middle-market purchase price multiples have nearly doubled since 2009. To be sure, most metrics and indicators have bounced back substantially from the crisis, and private equity is no exception. PE valuations have risen moderately from year to year, sometimes in fits and starts, and now stand close to where they were in the halcyon days of 2008. To call attention to pre-crisis similarities often implies a feeling of déjà vu, that another downturn is around the corner.