SourceMedia’s Mid-Market Pulse: FIRE Sector Should See a Boost Through Remainder of Year

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Hints of caution emerge amid slowing economy and potential interest rate hike.

Despite concerns about slow M&A expansion, dealmakers in the financial services, insurance and real estate (FIRE) sector are upbeat about the coming year, according 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 FIRE sector scored 74.9 for the three-month outlook and 75.3 for the 12-month outlook. In the sector’s last reading in November, scores had registered 79.3 for the three-month forecast and 87.2 for the 12-month forecast.

“Survey participants were not as exhuberant as they were when last polled about the sector in November, immediately following the mid-term elections,” said Editor-in-Chief Mary Kathleen Flynn. “At that time, many said they believed Republican control of Congress would lessen regulation of the financial services industry, thereby boosting their hopes for the sector.”

In this recent poll, some participants worried a slowing economy and potential hike in interest rakes would slow M&A expansion in financial services, which was reflected in a lower score, according to Flynn.

FIRE did outpace the overall M&A market, which scored 70.7 for the three-month outlook and 70.2 for the 12-month outlook.

Each month, the MMP index spotlights an individual industry and presents respondents’ expectations for deal activity within that specific sector.

For a complete analysis of the MMP’s most recent data, go to:

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 FIRE sector respondents have a watchful eye on interest rates to capitalize on the current low-rate environment.

“[An] impending interest rate hike is going to factor into valuations and opportunities,” one dealmaker said. Another noted that “banks remain very aggressive but rumors of rate hikes may keep valuation multiples in check as financing costs increase.”

Interestingly, some respondents believe the summer months might result in a “breath-catching,” or slower, period with a pickup toward year-end. Others remarked that there is still too much capital waiting on the sidelines.

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 at

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 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 nearly 8,000 professionals and associates 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 @McGladreyPE and/or connect with us on LinkedIn.

For more information, please contact:

Dana Jackson                    

Mary Kathleen Flynn

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