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I don't think you can gain an accurate picture of an industry in 20 years. Enron was considered one of the leading firms 20 years ago. What industry incumbents remain in 20 years will look vastly different.
Current industries that are doing well for IB include Tech, Media (although it's consolidating), Real Estate, and Healthcare (Biotech is crazy in a bull market and Medical Equipment is huge). All of those have exposure to growth, but that's what's good now.
5 years, we could be in a high rates environment. Real Estate is suddenly shuttering. Media might have consolidated into only a few companies, denying deal flow. Oil and gas could be booming due to higher oil prices.
Totally agree with what you said except for your last point. I don't see oil&gas booming, might still be big but because the world will have moved towards renewables, hence infrastructure will be big, just my 2 cents
Your oil comment is pretty far off. Global oil demand has increased every year for the past 70 years and is projected to continue to increase in the near future. Maybe in 2100 the oil and gas industry will be overtaken by renewables, but that's a few years away. Plus, it is really oil price volatility that drives activity in the market, not just the shear level of prices. Hence, even if the market shrinks there will still be activity (even if the market is smaller than it is today).
Might be biased as I am based in Europe. Most of the O&G deals that are coming in are either from Norway which wants to diversify its economy after making big profits with oil or the Middle-east which is starting to take the same path as Norway. We might see a spike of deals in the coming 3-5 years but after I see it going down.
Gouvernements (not Trump) are investing in renewables, publicly or privately. They highly value ESG as well (with various incentives), pushing PE firms and asset managers to invest in green bonds, renewable infrastructure... Hence in 20 years when they will want to get their investments public, sell them to public companies or buy more infrastructure I see this industry getting bigger. This probably isn't applicable to America for various political reasons amongst others.
If you’re an upstream only guy then ya, you’re only going to be able to do upstream work but getting an MBA could help you reposition. I’m sure you could transition even pre-MBA but it would probably need to be to another IB group before PE or anything else.
If you’re at a diversified energy bank, which is most, then you can really model anything. Midstream is a little tricky but it and infrastructure are very similar. Oilfield services is very similar to industrials and there’s even a lot of energy tech/IoT out there too so the broad skill set is easily transferable to a variety of things.
You can also transition to power and probably could craft a good story to switch into renewables, though that might be viewed as insincere.
So I wouldn’t say you’d be pigeonholed by any means but if you’re not genuinely curious about O&G or from Houston then you won’t even make it to super day, folks see through fake interest.
Most important thing (if you're choosing coverage group) is to work with people you like, who are well regarded and can mentor you. All of the industries listed above are good, but relative industry group rankings vary a lot by bank
Here’s my opinion on the energy IB’s in terms of dealflow & comp (in no particular order). The best dealflow in energy IB’s is typically going to be in the upstream which is why you see so many upstream shops listed below. Midstream is also pretty solid, but downstream and OFS is not as active.
Best dealflow - GS, EVR, Petrie, Jefferies (really strong A&D), TPH, CS, would probably also throw MS in here.
Best Comp (and worst hours) - EVR, Petrie, Jefferies
Citi, BAML, JPM, and MS are big in the midstream space. BAML and JPM win a lot of business by using their balance sheets, no surprise here. I would say Moelis is on the rise and has done some good midstream work recently. GS is relatively balanced across all sectors, can’t go wrong here. Jefferies does a TON of A&D deals and basically dominates that space. Petrie does a lot of upstream M&A as well as some midstream, heard it’s a sweatshop, but worth it if you can stick it out. WF has a very laid back group and the culture is supposed to be awesome (hours not as bad), don’t know much about dealflow. TPH has pretty good deal flow from what I have heard, although from what I understand they didn’t do very well during the restructuring period. Energy is a very diverse industry and the banks all tend to focus in specific vertices (which can make actually ranking them a little tricky). This is just my opinion and obviously some people are going to disagree. But in general, I think it’s a pretty accurate representation of the energy shops and you can’t really go wrong with any of the shops listed above.
This is a pretty decent breakdown though I'd say BAML and JPM are pretty meh. I mean, ya, they do a decent deal every once in a while but they're not that far ahead of DB or WF at the moment. You really have to divide up each vertical to rank dealflow imo and then do an overall ranking. That said, it'd be really hard to not have EVR and Jefferies at the top right now. EVR has a nice distribution while Jefferies dominates A&D. GS, MS, and CS get on a lot of name brand stuff but they lag a bit on M&A vs. EVR/JEFF. I'd maybe throw TPH in there too, their upstream guys are great and their midstream team is winning some solid stuff too.
It's not that OFS isn't active, it's that Simmons and PPHB dominate the market and handle pretty much everything below $500mm and will happily sell it to smaller players while the BB/EB won't really go below $300mm and there's just not that much work to be had at that level.
Petrie is like the ultimate sweatshop, but their guys place into solid MM energy PE shops. Haven't heard about any midstream deals they've been on but they see some big upstream work for being like a 10 man office.