Corbin Advisors Releases Q2’24 Inside The Buy-Side® Industrial Sentiment Survey®
2024年7月19日 - 4:52AM
ビジネスワイヤ(英語)
Survey Finds Precipitous Decline in Industrial
Investor Optimism amid Renewed Demand Concerns; Those Expecting
Broad-Based Softness Doubles QoQ
- 31% characterize current sentiment as Bullish or Neutral
to Bullish, down from 68% captured last survey; more investors,
47%, say view is Neutral, up from 19%
- Similarly, just 16% describe executive tone as Bullish
or Neutral to Bullish, down from 66% QoQ, with 63% now perceiving
talk tracks as Neutral, up 40 pts
- 94% expect broad-based Industrial weakness, double the
concentration registered last quarter
- 57% and 44% expect Q2’24 results to be In Line
with consensus and sequentially, respectively; a slight majority,
54%, expect performances to be up YoY
- Reinvestment remains the preferred use of cash, with 65%
in support of Maintaining growth capex levels; M&A continues to
see increased support
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Corbin Advisors, a strategic consultancy accelerating value
realization globally, today released its quarterly Industrial
Sentiment Survey®. The survey, part of Corbin Advisors’ Inside The
Buy-Side® flagship research publication, was conducted from June 14
to July 12, 2024, and is based on responses from 37 institutional
investors and sell-side analysts globally who actively cover the
Industrial Sector. The buy-side firms represented in our survey
manage more than $320 billion in assets and have $47 billion
invested in Industrials.
Following last quarter’s survey which found a jolt of optimism
among respondents amid heightened anticipation of Industrial growth
potential, the Voice of Investor® captured in this survey registers
a large pullback in sentiment to a more neutral stance overall.
While outright bearishness remains limited, those expecting
broad-based Industrial weakness doubles in concentration, and
survey respondents voice increased concern over both underlying
demand and the sustainability of margins/pricing power.
“With Industrial earnings on the horizon, our survey this
quarter identifies growing investor unease and a meaningful
downshift in sentiment following outsized optimism captured last
quarter. Investor views and executive tone are now categorized as
decidedly neutral amid escalating concerns over a sector-wide
slowdown, with the level of bullishness captured at a 20-quarter
low,” said Rebecca Corbin, Founder and CEO of Corbin
Advisors. “Increasing apprehension over top- and bottom-line
performances, compounded by heightened geopolitical concerns, have
culminated in muted outlooks across nearly all Industrial
sub-sectors that we track. Despite resurfacing concerns over growth
and margins and a flurry of notable pre-announcements, expectations
for Q2’24 results remain largely intact, with views that prints
will be in line with both last quarter and consensus and that
annual outlooks will hold. While bullish sentiment has come in
based on deteriorating macro views, we foresee the potential for a
higher number of companies to lower guidance than is currently
expected amid signs of emerging supply chain and other operational
issues, including labor productivity, as well as the continued
impact of U.S. election uncertainty on customer spending. Leading
topics of interest for earnings calls include margins and pricing
power, order rate trends, and back half growth."
Notably, nearly all respondents, 94%, expect broad-based
Industrial weakness, doubling in concentration QoQ. Moreover, 60%
now expect 2024 Industrial organic growth to be lower than 2023, up
from 27% QoQ, and those expecting a higher growth rate decline from
46% to 20%.
Continuing, more survey contributors anticipate decelerating
order rate conditions over the next six months, and while 47%
report Industrial companies within their coverage universe are
still passing on cost/increasing price, this is down from the 76%
registered in Q1’24. Amid these factors, apprehension over
geopolitical risks more than triple QoQ.
"My sentiment has deteriorated a little from earlier in the year
as the persistent higher interest rates seem to finally be
influencing activity on a negative note. We've begun to see
negative pre-announcements and/or that pricing is eroding from
enough companies to know the environment is less robust,”
commented a portfolio manager whose firm has $6.3 billion
invested across the Industrial sector.
Reinvestment remains the preferred use of cash, with 65% in
support of maintaining growth capex. As well, M&A continues to
see increased backing in the #2 position, preferred by 51%, which
represents an increase from 44% last quarter and 36% in Q4’23.
However, those supporting Dry Powder, or conserving cash, soars
from 5% to 32% QoQ.
Regarding industry sentiment, bears outweigh bulls across the
majority of Industrial sub-sectors. In particular, pronounced
bearish sentiment is most evident in Transportation, Ag, Autos, and
Building Products. Conversely, Defense and Commercial Aero are the
only sub-sectors to retain bulls QoQ. As far as geographic
exposure, North America remains the regional darling for nine
consecutive quarters, though at levels below prior survey findings,
followed by APAC (ex-China) and Europe. China remains out of favor,
garnering zero support as a compelling region for the second
consecutive quarter, as risk aversion remains elevated.
About Corbin Advisors
Corbin is a strategic consultancy accelerating value realization
globally. We engage deeply with our clients to assess, architect,
activate, and accelerate value realization, delivering
research-based insights and execution excellence through a
cultivated and caring team of experts with deep sector and
situational experience, a best practice approach, and an
outperformance mindset.
Inside The Buy-Side®, our industry-leading research publication,
is covered by news affiliates globally and regularly featured on
CNBC.
To learn more about us and our impact, visit
CorbinAdvisors.com
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version on businesswire.com: https://www.businesswire.com/news/home/20240718702890/en/
Devin Davis, Head of Marketing & Communications (609)
577-9006 devin.davis@corbinadvisors.com