GPs now underwrite to operations, not multiples.
Earnings growth: 50. Top-line revenue: 49. Multiple expansion: 39. The means tell the story.
EY's Private Equity Pulse for Q1 2026 surveyed GPs on their base-case 12-month outlook for portfolio performance on a 1–100 scale. The means tell the story directly: earnings growth at 50, top-line revenue at 49, multiple expansion at 39. Sponsors are no longer underwriting to valuation uplift. They're underwriting to the operating model.
Three patterns underneath: tech allocation collapsed in one quarter, capital is rotating to visible cash flows, and geopolitics now leads the risk list. When the sponsor's outlook says the operating model — not the multiple — carries the return, your board conversation has to match.
What used to be a footnote in the value creation plan — operational margin gains, working-capital discipline, automation savings — is now the headline. The CxO who frames the operating plan as the value creation story is the one whose deal extends.