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February 2018
Enterprise Software
Sectorwatch
Within enterprise software, we continue to see headline transactions most notably focused on cloud enablement, security, and AI / machine learning. Software players in these specific sectors have attracted premium offers and are being rewarded for posting double digit revenue growth rates.
Industry Trends:
- Current revenue growth rate exceeds the average of the last 3 years, indicating that market momentum is increasing
- Current gross profit margin is less than the average of the last 3 years gross profit margins, indicating customer pricing power
- Current EBITDA margin is less than the average of the last 3 years EBITDA margins, which may signal further consolidation
