STATE OF THE INDUSTRY - Far from Dead
As we see P/E multiples and stock prices improve, we will also see a restoration of buying activity—this time with a more selective and disciplined approach.
We believe that "Phase III -The Profit Growth Era," will begin by 2003. Equilibrium between printers and their customers will be achieved and the public companies will enjoy gross margins ranging from 35 percent to 40 percent, and EBITDA margins approaching 20 percent.
During this phase, up to eight consolidators will aggressively, but selectively, pursue strategic targets at multiples that will probably be significantly lower than the prices paid during 1997-1998.