GCG’s Q4 2024 Business Services Industry Update provides an overview of the latest trends in the Commercial/Residential Services, Facility Services, Industrial Services, Infrastructure Services, Professional Services, Real Estate Services, Specialty Distribution, and Staffing Services sectors, including recent operating margin performance, valuation multiples, and the state of the middle-market M&A environment.

Key findings include the following:

• Amongst the 8 Business Services sectors that we cover in this report, common recent trends include significant technology investment underway, including integrating apps, digital platforms, and tools for scheduling and customer management; double-digit % increase in data/privacy breaches pushing service providers to double down on cyber security priorities; additive manufacturing through the use of 3D printing; and social media adoption enhancements.
• Q4 M&A deal activity decreased in 7 of the 8 Business Services sectors compared to Q3 2024 (the lone exception being Specialty Distribution). Overall, 2024 M&A activity in North American Business Services industries was down approximately 10% vs 2023. 2024 M&A multiples for most of the sectors within Business Services averaged 1.5x-2.0x LTM Revenues and 12x-14x LTM EBITDA.
• Based on a representative set of publicly traded companies across 8 Business Services industries, the group is trading at 86% of their LTM High stock price; 2.3x LTM Revenue and 14.1x EBITDA.

Click here for the full update.

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