Hi Joe, COVID 19 has affected businesses in different ways. Some businesses are booming and others are struggling. Look at the revenues and the resulting earnings of the particular business that you are considering. While there may be an inherent risk for sustainable long-term growth based on economic factors, it is really important to study the industry and the individual business performance. As you likely know, a valuation is based on the earnings and the likely continuation of those earnings into the future.

I think the bigger question is how banks will look at businesses amid recovery. I just closed a deal where the business sailed through lockdown and actually saw increased revenue. I'm working on another closing where the business saw almost 70% drop in revenue at the start of the lockdown and has now recovered to about 80% of pre-lockdown revenue. That one saw a discount, but the deal is moving forward. Both are bank financed (SBA). I'd love to hear some banker's thoughts on analysis of business currently and what hot button issues they are looking at re: lending.