Top 5 Takeaways from the Fourth Quarter 2019
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phoenixmanagement.com | phoenixmanagement.com/transactionadvisory | phoenixcapitalresources.com For over 30 years, Phoenix has provided smarter, operationally focused solutions for middle market companies in transition. Phoenix Management Services ® provides turnaround, crisis and interim management, specialized advisory and operational implementation services for both distressed and growth oriented companies. Phoenix Transaction Advisory Services ® provides quality of earnings, management/organizational review, business integration, sell-side business preparation and other transaction related support. Phoenix Capital Resources ® provides seamless investment banking solutions including M&A advisory, complex restructurings and capital placements. Phoenix Capital Resources is a U.S. registered broker-dealer and member of FINRA and SIPC. Proven. Results. For additional information visit our website or email [email protected]. ABOUT PHOENIX ©2019 Phoenix Management Services ® . All rights reserved. ® DOWNLOAD FULL REPORT PARTICIPATE IN SURVEY Continuing the trend established throughout 2019, lenders expect a downturn in the economy in both the near term and long term. Such a downturn is reflected in projections for a slowdown in the housing market in 2020, along with forecasted volatility in the retail industry following a consistent holiday sale’s season. IN AMERICA Lending Climate For more than 20 years, Phoenix Management Services has administered a quarterly survey to lenders from commercial banks, finance companies, credit funds, and other lending institutions to identify the latest economic issues, business drivers, and credit trends impacting lending in America. Despite concerns of the recession-weary American consumer over a U.S. – China trade war, the majority of lenders agree that consumer spending during the holiday season will stay consistent with recent sales trends. Lenders expect retail trade to experience the most volatility in the near-term, while expectations for volatility for manufacturing dropped significantly, falling from 58- percentage points in Q3 2019 to 22-percentage points in Q4 2019. Top 5 Takeaways from the Fourth Quarter 2019 2 3 Predicted Impact of Trade Wars on Retail Sales this Holiday Season 4 Top 3 Factors Projected to Impact the Near-Term Economy 5 Industries Expected to Experience Near-Term Volatility Q3 2019 Fall short of 2018 holiday sales 21% Exceeds 2018 holiday sales 32% Stay consistent with recent spending trends 47% While the housing rebound that began in spring 2019 has continued due to low mortgage rates, job growth, and a reduction in new home inventory, the majority of lenders believe this housing rebound will halt in 2020. Outlook for the U.S. economy in the long-term continued a downward from last quarter, decreasing 0.39 points from Q3 2019 to reach the low for the year. 63% of lenders believe home builders will see a decline in growth in 2020. U.S. Economy Long-Term Performance Grade Housing Market Growth A B C C C D F Weighted Average Performance Grade Weighted Average Performance Grade 29% 0% 0% 33% 38% 0% 6% 59% 29% 6% 2.04 Q4 2019 A B C D F 1.65 Sluggish Housing Market Q3 2019 Q4 2019 8% 39% 44% Constrained Liquidity in Capital Markets Q4 2019 32% Q3 2019 Stability of the Stock Market Q3 2019 Q4 2019 56% 50% Lenders continue to agree that stock market stability has the strongest potential to affect the near-term economy; however, concerns over a downturn in the housing market in 2020 lead to a 31-percentage point increase in the projected impact of the housing market on the economy. Retail Trade Healthcare & Social Assistance Construction Agriculture, Forestry, Fishing, & Hunting Manufacturing Q3 2019 Results Q4 2019 Results 67% 33% 29% 17% 58% 39% 28% 28% 22% 83%
Transcript of Top 5 Takeaways from the Fourth Quarter 2019
phoenixmanagement.com | phoenixmanagement.com/transactionadvisory | phoenixcapitalresources.com
For over 30 years, Phoenix has provided smarter, operationally focused solutions for middle market companies
in transition. Phoenix Management Services® provides turnaround, crisis and interim management, specialized
advisory and operational implementation services for both distressed and growth oriented companies. Phoenix
Transaction Advisory Services® provides quality of earnings, management/organizational review, business integration,
sell-side business preparation and other transaction related support. Phoenix Capital Resources® provides seamless
investment banking solutions including M&A advisory, complex restructurings and capital placements. Phoenix
Capital Resources is a U.S. registered broker-dealer and member of FINRA and SIPC. Proven. Results.
For additional information visit our website or email [email protected].
ABOUT PHOENIX
©2019 Phoenix Management Services®. All rights reserved.
®
DOWNLOAD FULL REPORT PARTICIPATE IN SURVEY
Continuing the trend established throughout 2019, lenders expect a downturn in the economy in both the near term and long term. Such a downturn is reflected in
projections for a slowdown in the housing market in 2020, along with forecasted
volatility in the retail industry following a consistent holiday sale’s season.
IN AMERICA
Lending Climate
For more than 20 years, Phoenix Management Services has administered a quarterly survey to lenders from commercial banks, finance companies, credit funds, and other lending institutions to identify the latest economic issues,
business drivers, and credit trends impacting lending in America.
Despite concerns of the recession-weary American consumer over a U.S. – China trade war, the majority of lenders agree that consumer spending during the holiday season will stay consistent with recent sales trends.
Lenders expect retail trade to experience the most volatility in the near-term, while expectations for volatility for manufacturing dropped significantly, falling from 58-
percentage points in Q3 2019 to 22-percentage points in Q4 2019.
Top 5 Takeaways from the Fourth Quarter 2019
2 3
Predicted Impact of Trade Wars on Retail Sales this Holiday Season
4Top 3 Factors Projected to Impact the Near-Term Economy
5Industries Expected to Experience Near-Term Volatility
Q3 2019
Fall short of 2018 holiday sales
21%
Exceeds 2018 holiday sales
32%
Stay consistent with recent spending trends
47%
While the housing rebound that began in spring 2019 has continued due to low mortgage rates, job growth, and a reduction in new home inventory, the majority of lenders believe this housing rebound will halt in 2020.
Outlook for the U.S. economy in the long-term continued a downward from last quarter, decreasing 0.39 points from Q3 2019 to reach the low for the year.
63%of lenders believe home builders will see a decline in growth in 2020.
U.S. Economy Long-Term Performance GradeHousing Market Growth
A BC
CC D F
Weighted AveragePerformance Grade
Weighted AveragePerformance Grade
29% 0%0% 33% 38%
0% 6% 59% 29% 6%
2.04
Q4 2019
A B C D F
1.65
Sluggish Housing Market
Q3 2019 Q4 2019
8% 39%44%
Constrained Liquidity in Capital Markets
Q4 2019
32%
Q3 2019
Stability of the Stock Market
Q3 2019 Q4 2019
56% 50%
Lenders continue to agree that stock market stability has the strongest potential to affect the near-term economy; however, concerns over a downturn in the housing market in 2020 lead to a 31-percentage point increase in the projected impact of the housing market on the economy.
Retail Trade
Healthcare & Social Assistance
Construction
Agriculture, Forestry, Fishing, & Hunting
Manufacturing
Q3 2019 Results Q4 2019 Results
67%
33%
29%
17%
58%
89%
39%
28%
28%
22%
83%
