PE Firms Value Home Services Companies on EBITDA and Growth Potential

PE firms evaluate home services businesses based on high cash flow (EBITDA margins north of 15%), high growth, and low risk. They look for diversified residential customer bases, maintenance agreement customers, and accrual-basis financials with proper revenue recognition.

“PE firms are buying cash flow, period. They want businesses with strong EBITDA margins, typically north of 15 percent, with a clear path to improvement.”

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