With gasoline and heating oil prices dropping, dealmakers see dollar signs for the consumer goods and retail sector in the near and intermediate terms, according to the latest reading of SourceMedia’s Mid-Market Pulse (MMP). The MMP, published by Mergers & Acquisitions in partnership with McGladrey LLP, is a forward-looking sentiment indicator that monitors near- and intermediate-term outlooks for merger and acquisition activity within the middle market.
The sector’s 3-month reading of 86.1 proved a pendulum change from October’s composite score of 48.5. The current near-term score also outpaced the overall M&A reading of 77.7.
“Expectations for M&A in the consumer goods and retail sector have risen significantly over the last few months as energy prices have dropped,” said Mary Kathleen Flynn, editor-in-chief of Mergers & Acquisitions. “Dealmakers anticipate that, as a result, families will have more discretionary income to spend.”
The 12-month forecast also was upbeat, rising to 72.2 from the 58.7 reading the last time the sector was examined.
Each month, the MMP index spotlights an individual industry and presents respondents’ expectations for deal activity within that specific sector. This month’s index focuses on the consumer goods and retail sector.
For a complete analysis of the MMP’s most recent data, go to: http://themiddlemarket.com/mmp-retail-March15
Inside the MMP
The Mergers & Acquisitions Mid-Market Pulse (MMP) is a monthly barometer of sentiment in the mergers and acquisitions business derived from monthly surveys of approximately 250 executives in private equity firms, investment banks, lenders, and advisory firms in accounting, law, and consulting.
Based on a regular set of recurring questions about expectations and trends across a range of key issues in M&A, the MMP is a leading indicator for potential changes in momentum in M&A activity. Various indicators that make up the MMP include projected deal volumes and pricing, staffing resource utilization levels, and the expected impacts of economic conditions, taxes and regulatory policy on future M&A activity.
Survey responses describe expectations and outlooks for three- and 12-month forward periods to arrive at indicator scores. Respondents also are asked to elaborate on their responses and provide opinions about other conditions that affect their M&A outlook.
What Respondents are Saying
Survey respondents are encouraged to add verbatim comments to their answers. Many believe consumer spending will rise thanks to lower gasoline and heating oil prices.
“Increased disposable income will drive increased activities in the [consumer goods and retail] sector,” one respondent said. Another commented: “I expect consumer confidence to continue to improve and strengthen as a driver of purchases.”
About SourceMedia
SourceMedia, an Observer Capital company, is a diversified business-to-business digital media company serving senior professionals in the financial, technology, and healthcare sectors. Brands include American Banker, The Bond Buyer, Mergers & Acquisitions, Financial Planning, On Wall Street, Accounting Today, Health Data Management, and Employee Benefit News. Information about SourceMedia is available athttp://www.sourcemedia.com.
About SourceMedia Research
SourceMedia Research, a unit of SourceMedia, provides research solutions for marketers, agencies and others targeting business sectors such as banking, payments, mortgage, accounting, insurance, employee benefits and investment advisor / wealth management. SourceMedia Research specializes in reaching senior and C-level decision makers through access to its large proprietary opt-in databases and panels.
About Mergers & Acquisitions
Mergers & Acquisitions covers all aspects of middle-market dealmaking, including identifying acquisition targets, negotiating transactions, performing due diligence, and closing deals. With more than 42,000 unique monthly visitors, the brand’s website at themiddlemarket.com is continuously updated, providing real-time information and analysis of news and trends in M&A. Its monthly magazine, which serves some 20,000 subscribers, is published in partnership with the Association for Corporate Growth (ACG), a global organization comprised of thousands of private equity firms, corporate officials and intermediaries. Mergers & Acquisitions’ online video series features interviews with high-profile dealmakers, including private equity partners, strategic buyers, investment bankers and other advisers..
About McGladrey
McGladrey LLP is the leading U.S. provider of assurance, tax and consulting services focused on the middle market, with more than 8,000 people in 80 cities nationwide. McGladrey is a licensed CPA firm and serves clients around the world through RSM International, a global network of independent assurance, tax and consulting firms. McGladrey uses its deep understanding of the needs and aspirations of clients to help them succeed. McGladrey serves private equity firms and their portfolio companies with integrated transaction advisory, tax, assurance and consulting services. Clients benefit from a single-point-of-coordination service model and teams that operate as strategic partners throughout the private equity life cycle. For more information like us on Facebook at McGladrey News, follow us on Twitter @McGladreyPEand/or connect with us on LinkedIn.
For more information, please contact:
Dana Jackson
Dana.jackson@sourcemedia.com
212-803-8329
Mary Kathleen Flynn
marykathleen.flynn@sourcemedia.com
212-803-8708
Corporate Contact:
Melianthe Kines
Director of Audience Development
212-803-8335
Melianthe.Kines@sourcemedia.com