GCG’s Q4 2024 Consumer Discretionary Industry Update provides an overview of the latest trends in the Beauty & Wellness, eCommerce, Footwear & Apparel, Home Furnishings, Jewelry, Juvenile Products, Pet Products, Sporting Goods, and Travel & Hospitality sectors, including recent operating margin performance, valuation multiples, and the state of the middle-market M&A environment.
Key findings include the following:
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- Amongst the 9 Consumer Discretionary sectors that we cover in this report, common recent trends include: enhanced affordability pricing innovation due to cost-of-living pressures; deferred payment options like BNPL on the rise; luxury spending hitting new lows; continued growth and importance of the eCommerce channel; growth of the European M&A market; pent up transaction demand heading into the start of 2025; Augmented Reality (AR) impacting fit and visualization
- Q4 M&A deal activity increased in 6 of the 9 Consumer Discretionary sectors compared to Q3 2024 (decliners: eCommerce, Jewelry, Footwear & Apparel). Overall, 2024 M&A activity in North American Consumer Discretionary industries was up approximately 5% vs 2023. 2024 M&A multiples for most of the of the Consumer Discretionary sectors averaged 1.0x-1.5x LTM Revenues and 9x-11x LTM EBITDA
- Based on a representative set of publicly traded companies across 9 Consumer Discretionary industries, the group is trading at 75% of their LTM High stock price; 2.5x LTM Revenue and 17.8x LTM EBITDA
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