Despite a challenging capital-raising environment and growing worries about new government regulations, private- equity firms are guardedly optimistic about fund returns and see strong investing opportunities in specific U.S. industries.

Those were the views expressed in a new quarterly CFO benchmark survey done in partnership with Rothstein Kass: the Rothstein Kass/CFO Midsize Private-Equity Firm Barometer. The survey, conducted in January, polled 90 PE firms that have $150 million to $1 billion in assets under management.

Despite a volatile stock market and concerns about the European debt crisis, more than half of the PE managers who responded to a question about their investment valuations said their portfolio assets had increased in value since the last reporting period; only 5.6% reported that their portfolio valuations had fallen.

Among the respondents who provided projections for 2011, the average expected return was 17%. For 2012, respondents expect modestly improved performance (18%), but for 2013, the average anticipated return jumps to 22%.

“The climate in Washington has been cited as a cause of prolonged economic malaise, and the resulting uncertainty has been weighing on private-equity firms as well,” says Rothstein Kass principal Jeff Somers.

When asked which sectors will provide the most value to private- equity funds this year, PE managers had a wide range of responses. But industrials, health-care-related businesses, and banking and finance lead the pack.

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