Middle market private companies in the Golub Capital Altman Index grew earnings by 11% during the first two months of Q2/24. Revenue grew 7% during the same period.

“Q2 2024 performance was once again strong, marking the seventh consecutive quarter of robust median revenue and earnings growth for companies in the Golub Capital Altman Index. That said, there was notable divergence between the relatively less strong performance of the Consumer sector and the double-digit earnings growth of the healthcare, industrials and technology sectors,” Lawrence E. Golub, CEO of Golub Capital, said. “We have been anticipating a reduced growth rate in the Consumer sector as the effects of pandemic-era stimulus and excess savings continue to run off. These numbers are actually a little better than expected in that context, as wage growth, job creation, immigration and low unemployment have kept consumer spending reasonably healthy. We believe the balance of headwinds and tailwinds facing consumers will be an important dynamic for investors to watch in the second half of 2024.”

“The strong Q2 2024 performance of healthcare, industrial and Technology companies in the Golub Capital Altman Index sample is an encouraging sign heading into public company earnings season. At the same time, we would caution against over-optimism; recent macroeconomic data has been mixed, with strong June jobs growth appearing alongside weakness in areas like housing starts and the ISM services index,” Dr. Edward I. Altman said. “Another economic headwind in the first half of 2024 was the challenge to many firms to meet escalating interest payments on their higher levels of debt. We believe it’s prudent for investors to remain humble about risk and uncertainty in today’s environment and to focus on investments and strategies that are likely to perform well across a wide range of potential scenarios.”