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18:12
Mar 04
Bruce Richards CEO, Chairman, and Founder, Marathon Asset Management Bloomberg Markets
Richards predicts a 15% default rate in software companies, comparing the sector to Energy in 2016. Kapnick notes that 2021-2022 vintage software deals were priced too high and will struggle. AI is a technological disruption that destroys the "moat" of legacy software companies (pricing power collapses). Private credit lenders leveraged these companies 20x; as growth slows and AI takes over, these companies cannot service debt, leading to a liquidity crunch. SHORT. Avoid the broad software indices, specifically those exposed to mid-cap/legacy SaaS. Fed cuts rates aggressively, bailing out highly leveraged growth companies.
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About PSJ Analyst Coverage

Buzzberg tracks PSJ across 1 sources. 0 bullish vs 0 bearish calls from 1 analysts. Sentiment: evenly split. 1 total trade ideas tracked.