GCG’s Q2 2020 Aerospace & Defense Industry Update provides an overview of the latest trends in the sector, including recent equity market performance, valuation multiples and transaction activity.
Key findings include the following:
- Q2 2020 represented a significant recovery for many public equities against the backdrop of the pandemic and market declines in the first quarter. Across the indices tracked in this update, A&D Components/Systems (+45.0%) and Aircraft/Engine OEMs (+32.0%) outperformed compared to the S&P 500 (+20.9%), followed by Defense Tier 1 (+5.7%) and Defense Component/Systems (+2.8%). Impacts of the pandemic continue to evolve with respect to global demand for air travel while the FY21 defense authorization remains in process.
- There were 28 transactions within the A&D industry involving United States based targets or acquirers, representing a more than 50% decline from the first quarter. 75% of Q2 transactions involved strategic acquirers with the remaining 25% representing platform acquisitions by financial buyers.
- Categorically, approximately 50% of transactions took place in the Aerospace industry, vs. 10.7% in the Defense IT/Services, 17.9% in Defense, and 21.4% in Space. Representative transactions are further highlighted in the report.
Click here for the full update.