In this report, we look at trends in the U.S. buyout industry, including fundraising and valuation and leverage multiples. We consider what this means for asset-based trucking carriers, which, in our view, are particularly unsuited to private equity ownership. We stress-test a LBO model of an asset-based trucking company in a downturn and demonstrate the fragility of truckload carrier profitability (net earnings down 114% on a 10% drop in gross revenue). Finally, we consider how recent PE-backed transportation deals and how they have fared.
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John Paul conducts research on multimodal freight markets and holds a Ph.D. in English literature from the University of Michigan. Prior to building a research team at FreightWaves, JP spent two years on the editorial side covering trucking markets, freight brokerage, and M&A.