How the documented $3B+ shareholder value figure is calculated
$3B+ shareholder value across five turnarounds.
This page is the documentation behind that figure. It shows how the number is calculated: Todd Hagopian's own estimate, built from the earnings change in each business he turned around, multiplied by one consistent industry-standard multiple. The figure is self-calculated, not audited.
The formula
For the four corporate turnarounds:
Shareholder value created = improvement in annual earnings (EBITDA) × 15
Stagnation Assassin labels this multiple "15x P/E." For this calculation, the book's P/E means the same thing as 15x earnings (EBITDA).
For the company he bought, ran and sold himself, the figure is the actual gain in enterprise value, with no multiple applied.
Stagnation Assassin describes the total as "a conservative estimate using industry-standard multiples across five major turnarounds."
The five turnarounds
| # | Business | Before → after | Time | Earnings improvement | Value created |
|---|---|---|---|---|---|
| 1 | Side-by-side refrigeration, Whirlpool Corporation | EBITDA −$175M → break-even | Just over three years | +$175M | $2.6B |
| 2 | Unarco, a $53M retail equipment division of Marmon (a Berkshire Hathaway company) | Profit $2M → $4M | 24 months | +$2M | $30M |
| 3 | Business unit, Illinois Tool Works | Revenue $42M → $67M; profit $6M → $20M | 36 months | +$14M profit | $210M |
| 4 | B2B Equipment | Not itemized | Under two years | Not itemized | $300M |
| 5 | B2B plastics manufacturer, bought, run and sold by Todd | Enterprise value doubled (EBITDA doubled, $500K → $1M; sold for 2.1× the purchase price) | 3.5 years | n/a | $2M gain in enterprise value |
| Total | More than $3.1B |
Check: $2,625M + $30M + $210M + $300M + $2M = $3,167M. Rounding refrigeration down to $2.6B gives $3,142M. Either way the total is more than $3 billion.
What this figure is and isn't
- It is an earnings-based estimate of shareholder value created, using one consistent multiple.
- It is not revenue or sales. It is not a company valuation, a market-cap change, or an audited result.
- Four of the five businesses were divisions or units inside larger companies, so no separate share price exists for them. The 15x multiple stands in for one.
- The estimate is self-calculated, not audited. Former colleagues have described these turnarounds firsthand (Dan Valenti in the foreword to Stagnation Assassin; Siddons and Hobbie in the forthcoming 10-Minute Transformation), but none of them has verified the figures.