Our 2020 Predictions - The Markets and Software M&A

On the back of a record year for M&A and another strong year for the equity markets, we thought we would share our predictions for 2020 in this short blog post.

Equity markets

The equity markets, especially the NASDAQ, performed exceptionally strong last year, finishing the twelve-month period up 35%! While Phase 1 agreement to the China trade war has been agreed to, there appears to be continued risk to the overall equity markets.  As such, our prediction for 2020 is that most of the major indices finish around flat for the year. This is pretty consistent with many of the Wall Street estimates.

Source: Yahoo Finance

Software M&A

2019 was a record year for software M&A with over $119bn of transactions getting announced.  That’s a 27% increase over 2018 which was another record year at the time.

Source: Pitchbook.

The question becomes, can this level of activity continue to grow at such a rapid pace. Our forecast for 2020 is that software M&A will be really strong in the first half of the year but will slow down in the second half as we get closer to the US election.  As such, we expect activity to be down year over year and pretty consistent with 2018 levels.

About Sampford Advisors

Sampford Advisors is a boutique investment bank exclusively focused on mid-market mergers and acquisitions (M&A) for technology, media and telecom (TMT) companies. We have offices in Toronto, Ottawa and the US and have done more mid-market tech M&A transactions than any other adviser.