- Healthcare Growth Partners’ (HGP) summary of Health IT/digital health mergers & acquisition (M&A) activity, and public company performance during the month of July 2020.
While a pandemic ravages the country, technology valuations are soaring. The Nasdaq hit an all-time high during the month of July, sailing through the 10,000 mark to post YTD gains of nearly 20%, representing a 56% increase off the low water mark on March 23. More notably, the Nasdaq has outperformed the S&P 500 (including the lift the S&P has received from FANMAG stocks – Facebook, Amazon, Netflix, Microsoft, Apple, Google) by nearly 20% YTD.
At HGP, we focus on private company transactions, but there is a close connection between public company and private company valuations. While the intuitive reaction is to feel that companies should be discounted due to COVID’s business disruption and associated economic hardships facing the country, the data and the markets tell a different story.
While technology is undoubtedly hot right now given the thesis that adoption and value will increase during these virtual times, the other more important factor lifting public markets is interest rates. According to July 19 research from Goldman Sachs,
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Source: Hit Consultant
