Despite the uptick in LBO EBITDA yields, the risk-free rate’s move up makes 2023 valuations particularly unattractive, historically speaking.
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Comparing EBITDA yields to the 10-year Treasury allows us to normalize for the interest rate environment when each vintage was beginning to make their leveraged investments. We then net that against buyout fund IRRs to approximate returns over that risk-free rate. For more on our views of the PE market, check out our Allocator Outlook and US Private Equity Outlook.
(Past performance is no guarantee of future results.)
Latest news
Q2'26 BDC analysis shows additional 184 bps of nonaccruals at cost
In a universe of 173 business development companies, or BDCs, Octus identified a total of $9.5 billion of debt (at cost) in nonaccrual status reported in the second quarter of 2026, a slight decline of 5% from $10 billion in the first quarter of 2026.
Reading the Board
The story changes depending on which numbers you’re counting.
Private Credit Defaults 101: Different Numbers, Different Stories
In Season 2 of Billions, Bobby Axelrod takes his lawyer Orrin Bach to an empty Yonkers racetrack in the dead of night.