What Assumptions Is An Lbo Model Most Sensitive To?

1.	What Assumptions Is An Lbo Model Most Sensitive To?
Answer» LBO models are most sensitive to the total LEVERAGE the BUSINESS can SERVICE (typically based on the debt/EBITDA ratio), the cost of debt, and the acquisition or exit MULTIPLE assumptions. In addition, OPERATING assumptions for the business play a major role as well. LBO models are most sensitive to the total leverage the business can service (typically based on the debt/EBITDA ratio), the cost of debt, and the acquisition or exit multiple assumptions. In addition, operating assumptions for the business play a major role as well.

Answer»

LBO models are most sensitive to the total LEVERAGE the BUSINESS can SERVICE (typically based on the debt/EBITDA ratio), the cost of debt, and the acquisition or exit MULTIPLE assumptions. In addition, OPERATING assumptions for the business play a major role as well.

LBO models are most sensitive to the total leverage the business can service (typically based on the debt/EBITDA ratio), the cost of debt, and the acquisition or exit multiple assumptions. In addition, operating assumptions for the business play a major role as well.

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