The hangover from the First Brands bankruptcy may be far from over for the private equity industry.
While Wall Street’s rally continues to break records, private equity stocks remain under pressure. Analysts now say the pressure may not ease soon.
In a note shared Tuesday, 22V Research’s analyst Bill Hebel said private equity firms remain particularly exposed to the weakest parts of the consumer credit spectrum.
Private Equity Still Under Pressure After First Brands Fallout, 22V Research Warns
In a research note shared on Tuesday, Bill Hebel of 22V Research stated that private equity firms are more exposed than banks to the weakest segments of consumer credit.
That vulnerability, he noted, ties them closely to the same structural pressures that helped topple First Brands—slowing income growth, the rollback of Affordable Care Act (ACA) benefits, rising tariffs and tighter immigration policies.
“Given the headwinds facing the low-end consumer—slowing labor income growth, the One Big Beautiful Bill’s ACA rollbacks, tariffs and immigration policy—going long high-end credit and short low-end credit is interesting right now,” Hebel said.