O'Shaughnessy: 4x Free Cash Flow Signals Distress in Public Equities, Not Private
Patrick O'Shaughnessy · Patrick O'Shaughnessy – O'Shaughnessy Asset Management (First Meeting, EP.01) · Jun 10, 2019 · at 1:00:51
Patrick O'Shaughnessy discusses Brent Beshore's private equity acquisition strategy and how small private market valuation dynamics differ from public equity multiples.
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“And, you know, when he first told me that he was buying businesses at a little bit north of four times free cashflow, you know, I kind of laughed. I thought, okay, like, so they're going out of business in three years. I mean, in the public markets, that multiple means the business is massively distressed in a very small business. That's not necessarily the case. And often these businesses are growing.”
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