Filing Flows › Morningstar (MORN) › Takeover & LBO
Is Morningstar (MORN) a takeover target?
A leveraged buyout at today's price plus 30% ($294.05 a share) would return about 5% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $195.15 a share (−14% against today's $226.19). Historically 2.4% of companies with its figures were bought within a year (0.48× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $294.05 | today's $226.19 plus 30% |
| × shares | 37.8 million | |
| = Equity value | $11.1B | |
| + Debt refinanced | $1.7B | |
| − Cash | $525M | |
| = Enterprise value | $12.3B | 14.5× EBITDA of $849M |
| Fees | $245M | 2% of the price |
| New debt | $4.7B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $7.8B | 63% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $2.8B | $917M | $357M | $293M | $4.4B |
| Year 2 | $3.0B | $979M | $335M | $351M | $4.0B |
| Year 3 | $3.2B | $1.0B | $308M | $408M | $3.6B |
| Year 4 | $3.3B | $1.1B | $277M | $463M | $3.2B |
| Year 5 | $3.4B | $1.1B | $241M | $513M | $2.6B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 11.4× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $12.7B | |
| − Debt left | $2.6B | |
| = Buyer's equity | $10.0B | |
| Money multiple | 1.28× | on $7.8B put in |
| Buyer's yearly return (IRR) | 5.0% |
Price against return
What the buyer makes at other premiums over today's $226.19; the IRR reaches 20% at $195.15 a share.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $248.81 | 10.5% |
| 20% | $271.43 | 7.5% |
| 30% | $294.05 | 5.0% |
| 40% | $316.67 | 2.9% |
| 50% | $339.28 | 0.9% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $2.6B | |
| EBITDA, last 12 months | $849M | 32.4% of revenue |
| Depreciation and amortization | $205M | |
| Capital spending | $149M | |
| Debt | $1.7B | |
| Cash | $525M | |
| Share price | $226.19 | on Oct 30, 2026 |
Fixed rules, the same as the interactive view's starting point: the shares are bought at today's price plus 30%, the company's debt is refinanced and fees take 2%. New debt is the least of 5.5× EBITDA, 65% of the price and the amount whose interest EBITDA covers 2 times, at 7.65% a year (SOFR 3.89% plus the high-yield B spread 3.26% plus 0.5%, rates of Oct 15, 2026). Revenue grows 8.0% in the first year — the company's own rate, held between −3% and +8% — fading to 3% by year 5; the EBITDA margin, depreciation and capital spending stay at today's share of revenue; working capital takes 10% of each year's added revenue; tax is 25% of profit after interest. Every dollar of free cash flow repays debt. After 5 years the buyer sells at today's multiple of EBITDA.
What a takeover could cost
Takeovers in its sector paid a median premium of 14.9% over the share price before the deal (the middle half 9.5% to 33.6%), according to the 17 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Morningstar would cost about $259.89 a share, $9.8B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 9.5% | $247.68 | $9.4B |
| Median | 14.9% | $259.89 | $9.8B |
| High end (a quarter paid more) | 33.6% | $302.19 | $11.4B |
The odds, from history
Historically 2.4% of companies with its figures were bought within a year (0.48× the average). Its figures put it in decile 1 of 10 (10 = the most likely to be bought). The odds come from a model of every merger proxy, tender-offer response and going-private statement filed on EDGAR since 2011, set against each company's size, margins, debt, cash flow and growth the year before.
Morningstar's latest quarter
Morningstar, Q3 2026: revenue $672M (+9% year over year), operating margin 24.9%, net earnings $116M, operating cash flow $191M. The chart follows the revenue to costs, profit and cash.
Questions
Is Morningstar being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Morningstar?
A leveraged buyout at today's price plus 30% ($294.05 a share) would return about 5% a year to a private-equity buyer over 5 years; the most a buyer could pay for a 20% return is $195.15 a share (−14% against today's $226.19).
What would a takeover of Morningstar cost?
Takeovers in its sector paid a median premium of 14.9% over the share price before the deal (the middle half 9.5% to 33.6%), according to the 17 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Morningstar would cost about $259.89 a share, $9.8B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.