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Executives in the NCMM Survey Expect Continued Growth; Pitchbook and Highland Ridge Agree

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  • Executives in the NCMM Survey Expect Continued Growth; Pitchbook and Highland Ridge Agree

If you’re a follower of our research, you know that we rely on the National Center For The Middle Market (“NCMM”) to provide up-to-date feedback on mid-sized companies, their growth, and their views on capital investment.  NCMM’s third quarter survey was again based on a survey of 1,000 C-suite executives of mid-size companies, and this latest report demonstrates the executives’ continued drive and optimism.

Tom Stewart, NCMM Director, said “very strong revenue growth  – 7.0% on an annualized basis – is solidly above the 6.6% average we’ve seen over the past 5+ years.  It was also once again  well above the performance of the growth companies of the S&P 500.  Healthcare, financial services, and business services … topped the charts in terms of top line growth, and all three of them are service sector industries.”

Tom continues, “This quarter, fully 70% say they would put (their extra dollars) to work as opposed to putting it aside for the future.  That percentage is typically a few points lower.  The end of 2015, it was just 61%.  … And what are they planning to do?  …  We’re seeing substantial increases in the percentage of companies who say they will make an acquisition, who say they will open new domestic markets, who say they will open new international markets, and who say they will invest in new plant and equipment.”  Clearly a growth story.  You can access the full report HERE .

When it comes to acquisitions, Pitchbook analyst Nico Cordeiro agrees: “We expect deal flow in the middle market to finish strong through the second half of the year despite a high-priced environment.  The need to deploy billions of dollars in commitments and tight credit spreads continue to make financing readily available.”

In addition to acquisitions, we expect growth capital to be readily available through year-end.  Recounting investor feedback at a recent ACG conference, Brooks Crankshaw (Managing Director and CEO of Highland Ridge) said “Both debt and equity investors have expressed strong interest in deploying capital to middle market companies that meet their investment criteria.  Industries including business services, manufacturing, and consumer goods are receiving the most interest.”

Contact Highland Ridge Capital to discuss your specific needs.