Private company valuations defy fall in listed stocks, adviser says

Fears that private investments are due for a price crash to match the drop in stock markets are overblown, according to a prominent manager and adviser for private portfolios.

March 10, 2023 . 10:37 AM

1 min read

Fears that private investments are due for a price crash to match the drop in stock markets are overblown.
Most private companies were priced at a substantial discount to public companies in the same sector at the start of 2022.
Falling public markets have narrowed the gap, but privately held communications and consumer discretionary companies were the only ones held at a higher multiple of earnings than their public peers as of late last year.
Private equity-owned companies as a whole held their value through the 2000s dotcom bust and after the 2008 financial crisis.
Private equity owners can often avoid taking writedowns by holding on to their investments until public markets bounce back.