10/4/09

What are the best industrials groups on the street (in terms of deal flow, exit opps, etc.)?

Comments (65)

10/4/09

Out of curiosity, why do you ask? I've never heard of someone having a particular interest in industrials.

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10/4/09

I think those are very interesting sectors...

10/4/09

From a skill set, Industrials will give you the broadest exposure. The financial modeling in Industrials gives you a very solid foundation going forward. If you go to a more specialized industry (energy, fig, etc) you get a bit more pigeonholed. It's also a good industry to get into PE, most of the companies in the sector have stable cash flows and are good LBO targets.

In terms of M&A, GS and MS's Industrials are traditionally the best.

If you're looking across all products, JPM and BofA ML are the strongest.

GS will give you the best exit opps and technical skill set. The other three have separate M&A groups, so the modeling will likely be outsourced but at GS there is no separate M&A group.

That being said, you're exit opps at any of these banks will be good.

10/4/09
10/4/09

I've always heard that ML's industrials group was the best. Not sure if that still holds true.

10/4/09

OP - I believe that Lazard has a great auto/transportation practice, but as a whole the firm is not known for Industrials.

Credit Suisse has a very solid Industrials group, especially given the strength of their Chicago office.

Compared to other industry sectors, there seems to be more parity between the different BBs, due to the breadth of sub-sectors. That being said, I echo Hybrid's comments that GS is generally associated with having the strongest Industrials practice on the street.

10/4/09
endlessrain:

OP - I believe that Lazard has a great auto/transportation practice, but as a whole the firm is not known for Industrials.

Credit Suisse has a very solid Industrials group, especially given the strength of their Chicago office.

Compared to other industry sectors, there seems to be more parity between the different BBs, due to the breadth of sub-sectors. That being said, I echo Hybrid's comments that GS is generally associated with having the strongest Industrials practice on the street.

what about the NY office?

10/5/09

I'm very interested in this as well, especially in auto/transportation

2/1/10
2/1/10

MLs team was poached by DB, so I'd put DB as one of the top industrials groups on the street. they recently advised on the black and decker deal along with GS.

GS's industrials group is probably the best though

BossMode

2/3/10

Is DB's M&A separate from its industry groups as well?

2/3/10

GS has traditionally been a leader in the industrials space. CS is especially strong in the services sector, which they pair with a solid industrials group. DB has been aggressively making moves, but haven't heard anything regarding the results of their spending spree.

2/3/10

So far, we have gotten that GS, MS, BAML, JPM, CS and DB are all "the best." Once again, this board doesn't know shit. "The best" can mean you so many different things depending on how you look at it. What all of these board lurkers (college and high school kids) need to realize is that it is important to have a good fit with your group and to make sure you learn the most you can during your Analyst stint. Any of the large IB's will give you deal experience. And I bet that NONE of the kids coming in as SA's and FT will be rainmakers, so what difference does it make? Exit opps? People asking about "the best" banks probably won't cut it after 6 months on the job anyways...

On top of that, I am still not sure why everyone on this board also still has a love affair with P.E...

Does anyone actually follow these markets, (i.e. PE) or is it all just bullshit speculation?

2/3/10

Even though MS has an M&A group, MS GIG does a lot of their own M&A modeling

2/3/10

Heard good things about Citi as well but can't really comment on the others.

2/3/10

Given that Industrials is such a catch all for companies, many banks have strong Industrials groups. Usually trading off for top spot by deal volume and market share is JPM, BAML, and GS. Other strong performers are Barclays and Citi. The nature of Industrials means that generally banks with larger balance sheets will be on top in this field.

2/3/10

Wells Fargo has a huge balance sheet and will soon surpass Citi in # of assets....how come Wells Fargo hasn't been mentioned by anyone?

2/3/10

Imagine you are a CEO and are presenting a financial strategy to your board of directors, do you think you'll sound more credible saying that you had been advised by Citi or Wells Fargo?

You go to WF because you need loans, not strategic financial advice.

2/3/10

GS Industrials does a lot of M&A compared to the other firms. They also do a lot of Sponsor work for Industrials as well.

2/3/10

I don't know if you're choosing between offers, but if you are, keep in mind that like @cayo275 mentioned, industrials is an extremely broad group. Some banks focus on one vertical, while others split it up. You could be working with everything from a pipe manufacturer to a cardboard box manufacturer. That might affect whether or not you actually enjoy working at a particular bank.

2/3/10

"Preftige" is typically a lagging indicator of performance.

2/3/10
2/3/10

As a rule of thumb, balance sheet banks do better in industrials than pure advisory plays.

Goldman is the exception to that rule, though as in M&A, as mentioned, Goldman is number 1 by a significant margin...the group is a sweatshop but they do do deals for sure. Citi, BAML, Barclays and either CS or MS round out the top 5.

It's curiously not one of the stronger groups at MS and JPM relative to the Street, but given how diverse it is there is still a lot of fees to go around. If you incorporate loans, JPM moves up significantly in these rankings--not saying either are bad here but the group underperforms relative to the rest of the bank.

That being said, certain banks are very very good at specific subverticals within industrial,, even if lower on the overall league tables. For example MS and Jefferies dominate shipping, UBS in mining, Barclays traditionally has been good in airlines and building products....

Also to those asking about Wells, Wells Fargo still remains essentially a Middle Market investment bank that does loans. If they ever wanted to take more risk, they certainly could move up the league tables with their balance sheet, but they hardly are ever taking a lead M&A role in any of the big deals in the sector--you do see them around the mid market though.

TL:DR--league tables can be cut a million different ways but it's especially true for industrials which is such a broad sector. Any bulge bracket will have good deal flow here.

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2/3/10

im not sure if one is far and away better than the others.

2/3/10
2/3/10

Avoid GS. The culture there is noxious. I am not referring to culture in the sense of work-life balance like so many do. I am referring to a pervasively poor attitude, stiff and formal working environment, generally unfriendly demeanor, and unfavorable reputation on a human capital level.

That being said, the dealflow is very strong, the exits are fair, and it is one of the stronger Industrials coverage groups on the street. You just don't want to work there.

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2/3/10

Citi is top in industrials. solid chemicals group in NY

I don't throw darts at a board. I bet on sure things. Read Sun-tzu, The Art of War. Every battle is won before it is ever fought- GG

2/3/10

APAE:

Avoid GS. The culture there is noxious. I am not referring to culture in the sense of work-life balance like so many do. I am referring to a pervasively poor attitude, stiff and formal working environment, generally unfriendly demeanor, and unfavorable reputation on a human capital level.

That being said, the dealflow is very strong, the exits are fair, and it is one of the stronger Industrials coverage groups on the street. You just don't want to work there.

I know someone there and he doesn't give that impression.

2/3/10

peinvestor2012:

APAE:

Avoid GS. The culture there is noxious. I am not referring to culture in the sense of work-life balance like so many do. I am referring to a pervasively poor attitude, stiff and formal working environment, generally unfriendly demeanor, and unfavorable reputation on a human capital level.

That being said, the dealflow is very strong, the exits are fair, and it is one of the stronger Industrials coverage groups on the street. You just don't want to work there.

I know someone there and he doesn't give that impression.

There are some great people in the group but I have heard similar - the work-life balance is rough too.

2/3/10

I'm pretty sure JPM industrials is currently top, they've been doing really well this year.
GS is also a steady fixture at the top
http://markets.ft.com/investmentBanking/bankingLea...

2/3/10

peinvestor2012:

APAE:

Avoid GS. The culture there is noxious. I am not referring to culture in the sense of work-life balance like so many do. I am referring to a pervasively poor attitude, stiff and formal working environment, generally unfriendly demeanor, and unfavorable reputation on a human capital level.

That being said, the dealflow is very strong, the exits are fair, and it is one of the stronger Industrials coverage groups on the street. You just don't want to work there.

I know someone there and he doesn't give that impression.

Cool, I'm glad he isn't getting a bad experience out of it, but I don't feel a particular need to go toe-to-toe to prove who knows more about the group. I can and would repeat what I said with confidence.

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Best Response
2/3/10

Depends on which verticals you consider Industrials. BAML is at the top of Materials in that FT link, which consists of verticals that fall into their Industrials coverage group. Anyone on this board is going to tell you their firm is on top because everyone's league tables are skewed to show them on top. I'd say JP, BAML, and GS are actually at the top of Industrials at this point.

2/3/10

Industrials thrive at lending-heavy banks (BAML, Citi, JP). You'll get a ton of deal exposure, but the majority of it would be lending-based (notes/bonds/sponsors). GS doesn't have as large of a lending base, so their work is more M&A/sponsor advisory. The four groups (GS/BAML/Citi/JP) are all good - just the mixture of the type of deals you'd see at GS vs the other three is different.

Hope that helps.

2/3/10

Thoughts on wfc industrials group?

2/3/10

I'm seeing WFC Industrials on more and more deals but rarely on the left. Much like BAML they seem to enjoy riding their balance sheet to right books while JPM, GS or even CS take left and do all the heavy lifting. Long story short I'm sure its a fine group but will never be mentioned with the others until it starts moving left

2/3/10

WFC industrials is the best WFC industry group. Relative to the street though - i don't know

2/3/10

ivyhockey:

Industrials thrive at lending-heavy banks (BAML, Citi, JP). You'll get a ton of deal exposure, but the majority of it would be lending-based (notes/bonds/sponsors). GS doesn't have as large of a lending base, so their work is more M&A/sponsor advisory. The four groups (GS/BAML/Citi/JP) are all good - just the mixture of the type of deals you'd see at GS vs the other three is different.

Hope that helps.

I agree, very accurate.

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2/3/10

APAE:

Avoid GS. The culture there is noxious. I am not referring to culture in the sense of work-life balance like so many do. I am referring to a pervasively poor attitude, stiff and formal working environment, generally unfriendly demeanor, and unfavorable reputation on a human capital level.

That being said, the dealflow is very strong, the exits are fair, and it is one of the stronger Industrials coverage groups on the street. You just don't want to work there.

I know a few people in this group and have gotten a very similar impression

2/3/10

Does anyone have any thoughts on industrial group rankings within the independent advisory and MM space? Most of the above commentary is focused on BBs.

2/3/10

Would also be interested especially with some of the lower MM firms and up.

2/3/10
2/3/10

Anyone have any info on this? See below.

---------

Does anyone have any thoughts on industrial group rankings within the independent advisory and MM space? Most of the above commentary is focused on BBs.

2/3/10

Bumping this for 2015. Any particularly good EB Industrials groups?

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2/3/10

Please search the forum. There are heaps upon heaps of comments on the BB industrials.

2/3/10
aadpepsi:

Please search the forum. There are heaps upon heaps of comments on the BB industrials.

i tried to but there is problem with the search enging on the new site and nothing was coming up.

  • justanotherbanker
  •  2/3/10

"Industrials" is a broad sector as it has a number of subsectors such as transportation, shipping & logistics, aerospace & defense, metals & mining, materials, chemicals, multi-industrial, automotive, etc. These are grouped together in different ways at different banks and it makes direct comparison difficult. However, three banks stand out as consistent winners in Industrial. Bloomberg will verify this.

JPMorgan
UBS
Merrill Lynch

Deutsche and Citi pop up a lot too. However, I believe Deutsche was mostly there for big financings rather than advisory roles (not sure about Citi). The three banks above are definitely very active across all product groups.

2/3/10

can anyone elaborate on Citi's position?

2/3/10

JPMorgan has been #1 for five years running based on revenue for sure and deal value as well i think.

2/3/10

GS is tops I'd say. I think C is pretty good too. MS. UBS has been on some big deals recently as well.

2/3/10
2/3/10

I'm making it up as I go along.

2/3/10

JPM and BofA have been on most of the recent equity deals in the space

2/3/10

Equity is definitely JPM.

Citi and JPM for M&A.

2/3/10

Citi fired their industrials group a while ago

2/3/10
ILOVENYGUY:

Citi fired their industrials group a while ago

wtf does that even mean?

2/3/10

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