Wed, Jul 5, 2023

Industry Multiples in Europe - Q1 2023

We are pleased to launch the sixth edition of our Industry Multiples in Europe quarterly report. This report provides valuable insights into trading multiples for various key industries in Europe as of March 21, 2023.

Our analysis uses constituents of the STOXX® Europe Total Market Index (“STOXX Europe TMI”), which covers about 95% of the free float in Europe.

In 2023, the global economy still faces a lot of uncertainty, with the challenges faced over the past three years, such as COVID-19 and the war in Ukraine, still reverberating in today’s economy as many economies are still absorbing the shocks. While it seems that recovery is on the way, the forces that shaped the world in 2022 are likely to continue. Inflation has started to soften in many regions, but the rapid rise in interest rates to fight inflation led to other impacts, as seen with the recent turbulence in the banking sector. Equity markets are still volatile in 2023. The daily average of the volatility index on the EURO STOXX 50® index (VSTOXX®) during the first three months of 2023 was lower than the 2022 overall daily average. However, the 2023 year-to-date daily average is still more than 30% higher than the overall daily average of 2019 (before the COVID-19 pandemic started).


According to the World Economic Outlook report, released by the International Monetary Fund (IMF) in April 2023, global growth is projected to reach 2.8% in 2023, below the estimated growth in 2022 of 3.4%.
For the eurozone, the IMF forecasts growth to decelerate from 3.5% in 2022 to 0.8% in 2023, followed by 1.4% in 2024.
The IMF’s estimate for global inflation is 7.0% in 2023, down from 8.7% in 2022, to be followed by 4.9% in 2024. Inflation is expected to be above central banks’ targets for most economies at least until 2025.
In terms of EV/EBITDA, multiples have generally remained relatively stable during the first quarter of 2023, with a few industries presenting significant variations. For example, the median EV/EBITDA multiple of semiconductors and semiconductor equipment increased to 15x (from 10x in Q4 2022).

Our report provides a detailed overview of the EV/revenues, EV/EBITDA, P/E and P/B multiples of companies in the STOXX® Europe TMI covering nonfinancial industries and market capitalization/revenues, P/TBV, P/E and P/B multiples covering financial industries for which such data is available. We also provide an eight-quarter look back at the trends of these multiples for the industries covered.

We hope you find this report helpful for understanding the range of trading multiples for major industries in Europe. If you would like to receive further information or discuss any of the findings, please contact us.

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