Macro Level Thoughts

April 04, 2025
by a searcher from The University of North Carolina at Chapel Hill - Kenan-Flagler Business School in Austin, TX, USA
I'm just thinking out loud here:
As searchers, a lot of us look at LMM businesses with MM or public customers. You can see the uncertainty in the markets and economy right now by looking at all the red on trading screens. Uncertainty usually means avoiding large investments, which could translate to a slow year for most sectors.
Do we (searchers) want to buy a highly-levered business right now knowing that they will probably have a slow first year....or do we want to buy a solid business AFTER a slow year (due to systematic risks) from an exhausted owner at much better multiples and deal terms? I understand that most traditional searchers and independent sponsors with mandates might not have the luxury of hitting the pause button for 6-9 months. Or maybe they can with the right conversations with their investors.
What are your thoughts? I really want to hear perspectives from searchers, sponsors, and investors on this.
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
Personally I think any manufacturing company that can replace certain types of overseas production because the cost structure is not too far off is likely a great buy right now.
Just my two cents from the peanut gallery. Good luck everyone.
from The University of Texas at Austin in Austin, TX, USA