Key Takeaways
- • Median enterprise value-to-EBITDA multiples in the midmarket ($10M–$500M) expanded to 9.2x in the twelve months ended March 31, 2026, up from 8.4x in 2024, signaling sustained valuation momentum despite subdued deal volume.
- • Upper-middle-market deals ($200M–$500M) reached 11.4x multiples versus 9.6x a year prior, while the $500M–$999M segment climbed to 12.0x from 10.1x, indicating valuation strength concentrated in larger transactions.
- • Valuation gains are bifurcated by quality: stronger companies with above-median operating margins command premium pricing, while lower-quality assets face margin compression, creating a measurable divide in deal pricing across the market.
- • In manufacturing, businesses in the $10M–$50M range with above-median margins (23.9%) traded at 7.2x multiples, versus 6.3x for below-median performers (13.5% margins), illustrating how operational consistency drives valuation dispersion.
- • Deal volume remains constrained across all size cohorts, indicating that pricing strength reflects buyer selectivity toward stable cash-generative businesses rather than broad-based transaction growth.
Summary
Middle-market private deal valuations have expanded materially over the trailing twelve months, despite a constrained transaction environment. According to PowerComps data maintained by TagniFi, median total enterprise value-to-EBITDA multiples across deals spanning $10 million to $500 million increased to 9.2x for the period ended March 31, 2026, compared with 8.4x in 2024—a gain of 80 basis points. However, this valuation strength is neither uniform nor broadly distributed; instead, it reflects concentrated buying interest in higher-quality assets.
The valuation expansion has been particularly pronounced at the upper end of the midmarket. Transactions in the $200 million to $500 million segment saw multiples surge to 11.4x from 9.6x year-over-year, while deals in the $500 million to $999 million range reached 12.0x, up from 10.1x. By contrast, the $10 million to $50 million lower middle market has experienced more modest multiple expansion, underscoring a clear stratification in valuation outcomes based on deal size and asset quality.
Bob Wegbreit, managing director of private markets at TagniFi, attributed this divergence to buyer discipline: "Valuations are rising, but not across the board—they're concentrated in a smaller group of stronger companies. Buyers are focusing on businesses with consistent margins and reliable cash flow, and that's creating a wider gap in pricing between higher- and lower-quality assets." This selectivity is evident in sector-specific data. Manufacturing transactions in the $10 million to $50 million range posted a median multiple of 6.7x alongside median EBITDA margins of 18.7%. However, data dispersion reveals a pronounced quality split: companies with above-median margins of 23.9% commanded multiples of 7.2x, while those below the median saw multiples compress to 6.3x despite margins of 13.5%.
Critically, overall deal volume has remained subdued across all size cohorts, suggesting that valuation gains reflect heightened selectivity and pricing discipline among buyers rather than broad-based transaction momentum. This dynamic underscores a bifurcated market where operational consistency and cash flow stability have become primary value drivers, with buyers increasingly pricing in lower risk premiums for businesses demonstrating above-median performance metrics.
The valuation expansion has been particularly pronounced at the upper end of the midmarket. Transactions in the $200 million to $500 million segment saw multiples surge to 11.4x from 9.6x year-over-year, while deals in the $500 million to $999 million range reached 12.0x, up from 10.1x. By contrast, the $10 million to $50 million lower middle market has experienced more modest multiple expansion, underscoring a clear stratification in valuation outcomes based on deal size and asset quality.
Bob Wegbreit, managing director of private markets at TagniFi, attributed this divergence to buyer discipline: "Valuations are rising, but not across the board—they're concentrated in a smaller group of stronger companies. Buyers are focusing on businesses with consistent margins and reliable cash flow, and that's creating a wider gap in pricing between higher- and lower-quality assets." This selectivity is evident in sector-specific data. Manufacturing transactions in the $10 million to $50 million range posted a median multiple of 6.7x alongside median EBITDA margins of 18.7%. However, data dispersion reveals a pronounced quality split: companies with above-median margins of 23.9% commanded multiples of 7.2x, while those below the median saw multiples compress to 6.3x despite margins of 13.5%.
Critically, overall deal volume has remained subdued across all size cohorts, suggesting that valuation gains reflect heightened selectivity and pricing discipline among buyers rather than broad-based transaction momentum. This dynamic underscores a bifurcated market where operational consistency and cash flow stability have become primary value drivers, with buyers increasingly pricing in lower risk premiums for businesses demonstrating above-median performance metrics.
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