Enterprisevaluemultiples,liketheequitymultiplesthatwe
examinedinthepreceding chapter,havewide ranges,with
somefirmstradingatextremelyhighmultiples.Likeequity
multiples,theyareconstrainedtobe greaterthanzero,thus
creating distributions skewed toward large positive values.
Value/Operating Earnings Multiples
Togetabettermeasureofthedistributionalcharacteristicsof
valuemultiples,webeginbylookingatmultiplesofoperating
income in Figure 9.1.In thisfigure, welook atenterprise
value as a multiple of EBITDA, operating income, and
after-taxoperatingincomeforfirmsintheUnitedStatesin
January 2006.
FIGURE 9.1Enterprise Value/Operating Income Multiples
We follow up by reporting the statistical properties, in
January2006,ofeachofthesemultiplesinTable9.3,starting