Industrials Industry Report - Q1 2025

Report Highlights

Elements Affecting the Dynamics and Outlook of the Industrials Industry in Q1 2025 and Beyond

• Overall, the Industrials industry continues to display resiliency in the face of certain headwinds, primarily economic and trade uncertainty. Sectors within the industry such as Aerospace & Defense, Contract Manufacturing, and Specialty Distribution have all displayed continued growth through the first quarter of 2025.
• The Aerospace & Defense sector continues to perform strongly with both the highest sector overall valuation (18.5x EV/EBITDA) as well as the largest increase in YoY multiple appreciation (+7.0%). Sector performance is driven primarily by geopolitical tensions/ uncertainty, increase in AI related technologies, and growing needs of the space sector.
• Contract Manufacturing and Specialty Distribution have both experienced steady performance in Q1 2025. Within the US specifically, a manufacturing reshoring renaissance is underway as geopolitical risks, such as trade tensions, global energy concerns, and political unrest, coupled with rising labor and shipping costs, have significantly altered the dynamics of global supply chains, subsequently incentivizing domestic manufacturing and distribution.

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Reach out to Dinan Capital Advisors Managing Director Tom Gerlacher for more report insights.