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The latest QCA / Peel Hunt Mid and Small-Cap Survey sees a continuation of themes familiar to our markets. There is an emerging disparity between how companies and investors view the public markets. Investors consider the current conditions are attractive for small and mid-caps while the companies disagree and think the situation is deteriorating. Concerns about macroeconomic conditions such as supply chains and liquidity resonate across the board which results in companies finding it more difficult to forecast their prospects, particularly in the current climate.

“The Eye of the Beholder” report also highlights a significant variance in how small and mid-caps should be defined in terms of market capitalisation. This has an impact on views of at what stage a company should consider listing on the Main Market. If a company on the Main Market is below the perceived minimum level of market capitalisation, investors do not think that such companies should be forced off the Main Market. 

There is broad agreement that retail investors make a positive impact and are desirable on a company’s share register. Both investors and company directors feel there is not enough quality research for small and mid-caps and that this hinders their investment decisions and liquidity respectively. 

Whilst much of the key topics focus on issues that are somewhat familiar to the small and mid-cap community, it is becoming increasingly obvious that there is an increasing disparity between how investors view the markets compared to companies. It is imperative that these two important players are brought together as they form a fundamental part of our economy and both have equally important roles to play in driving social and economic wealth. 

Read the full QCA / Peel Hunt Mid & Small-Cap Survey here.

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