Even the speculation that has dominated US headlines throughout 2019, the possibility of a recession, seems overblown to our respondents: a large majority (78%) do not expect an economic slowdown in the near to medium term. On the other hand, deal intentions — the centerpiece metric of the Barometer — slip below the 50% mark for the first time in two years, with 46% of US executives telling us they expect to transact in the next year.
Focusing business strategy on sustainable M&A success
US executives’ sanguine M&A intentions may be explained by the risks they see on the horizon, which belie their macro positivity. Nearly two-thirds (62%) expect an increase in hostile and competitive bidding, a sign of a healthy market but one fraught with challenges and the danger of overpaying. More than half of executives (56%) cite regulatory impacts — whether trade disputes, climate-change policy or regulatory uncertainty — as the greatest external risks to their business. Of course, these external pressures cut both ways in terms of corporate strategy. Among larger companies, those with revenues above US$5 billion, a solid majority (59%) tell us they are considering M&A because of ongoing trade or tariff uncertainties.