CEOs of some of the U.S.' fastest-growing companies are bullish about the economy's prospects over the next 12 months, according to a new PricewaterhouseCoopers survey. The company interviewed CEOs of 436 product and service companies for itsTrendsetter Barometer survey. Seventy-two percent of respondents are optimistic about the U.S. economy's prospects for the next 12 months, down 10 percentage points from last quarter and a year ago. Three percent were pessimistic, while 25% were uncertain.
"It is noteworthy that the previous quarter's surge in optimism was not accompanied by a corresponding increase in anticipated 1998 revenue," says Jim Atwell, the global private equity practice leader for PricewaterhouseCoopers, New York. "But midway through the year, these executives have reined in their expectations and are more cautious in their outlook."
On average, "Trendsetter" companies reduced their 1998 revenue growth expectations to 21% from the 24.5% level predicted in the first quarter, a 14% downward adjustment. Fifty-four percent plan to make major new investments of capital over the next 12 months, off three percentage points from first quarter 1998, but nearly equal to the 55% level of a year ago. However, their projected level of spending (11.5% of revenues) is off 25% from the previous quarter's estimates, and down nine percent from a year ago.