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Investment Perspectives: Finding Strong Value In a More Cautionary Environment

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  • The U.S. economy is in its 10 year of expansion, making it the second largest expansion in history. However, there is general uncertainty about the ability of the market to continue its upward trajectory.
  • Significant growth in dry powder is perpetuating a competitive pricing environment coupled with a slowdown in exit activity, increasing monitoring loads in most U.S. private equity managers’ portfolios.
  • Despite the resulting risk of return compression, high-quality managers with specialized and strong operational value creation skills in the U.S. middle market remain well positioned to generate attractive returns.

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