LBO Returns Calculator
Free LBO Returns Calculator models entry and exit EBITDA multiples, debt paydown, and equity check to MOIC and IRR. Stress test deal returns across different hold periods and exit scenarios instantly.
How It Works
Enter the inputs described in each field label for LBO Returns Calculator.
LBO returns link purchase and sale enterprise values to equity invested and debt repaid over the hold period. Pair with Enterprise Value and Trading Comps Valuation on portfolios.tools for entry multiple sanity checks.
Review MOIC and equity IRR at target exit year. Adjust entry and exit multiples to see return sensitivity. Stress test with flat EBITDA or lower exit multiples for downside cases.
Bookmark the page for quick reruns without installing software.
Step by step
- Open LBO Returns Calculator and enter your current inputs.
- Review calculated outputs and summary tables.
- Adjust assumptions and compare scenarios side by side.
Worked example
Adjust one input at a time to see sensitivity.
Common mistakes
Confirm tickers, percentages, and dates before acting.
Running a single baseline scenario ignores tail risks.
The Formula
Entry EV = Entry EBITDA × Entry Multiple
Exit EV = Exit EBITDA × Exit Multiple
Exit Equity = Exit EV − Exit Debt
MOIC = Exit Equity ÷ Entry Equity
IRR ≈ MOIC^(1 ÷ Years) − 1
Simplified model ignores dividends, fees, and working capital. Use detailed cash flow models for live deals.
Limitations and assumptions
Simplified model ignores dividends, fees, and working capital. Use detailed cash flow models for live deals. LBO Returns Calculator does not replace personalized advice.
Key terms
- What does LBO Returns Calculator measure
- LBO returns link purchase and sale enterprise values to equity invested and debt repaid over the hold period.
- How is the formula applied
- The formula block on this page shows every intermediate step so you can audit the math against textbook definitions.
- Model assumption
- Interpret results in context rather than as automatic buy, sell, or accept signals.
Compare alternatives
Pair with Enterprise Value and Trading Comps Valuation on portfolios.
FAQ
What does LBO Returns Calculator measure?
LBO returns link purchase and sale enterprise values to equity invested and debt repaid over the hold period. This calculator runs entirely in your browser on portfolios.tools.
How is the formula applied in LBO Returns Calculator?
Simplified model ignores dividends, fees, and working capital. Use detailed cash flow models for live deals.
How should I interpret LBO Returns Calculator results?
LBO returns link purchase and sale enterprise values to equity invested and debt repaid over the hold period.
What are common input mistakes with LBO Returns Calculator?
Stress test with conservative and optimistic inputs before acting. Document assumptions when sharing outputs with colleagues or lenders.
What are the limitations of LBO Returns Calculator?
Simplified model ignores dividends, fees, and working capital. Use detailed cash flow models for live deals.
Related Tools
Pair with Enterprise Value and Trading Comps Valuation on portfolios.tools for entry multiple sanity checks.