What’s Apollo’s Valuation?



EV-to-EBITDA ratio

Apollo Global Management (APO) has discounted valuations, as its enterprise value to earnings before interest, tax, depreciation, and amortization (EV-to-EBITDA) ratio on an NTM (next twelve months) basis stood at 6.72x as compared to the peer average of 17.19x. Blackstone Group (BX), Carlyle Group (CG), and KKR & Company (KKR) have EV-to-EBITDA ratios of 14.25x, 16.95x, and 20.38x, respectively, on an NTM basis.

Apollo Global is expected to recover from the discounted valuations mainly because of the strong 4Q17 results. The company witnessed inflows amounting to $7.6 billion in 4Q17, while in 2017, they were $56.5 billion. The company has $47.6 billion of capital available for deployments.

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Higher price target

Wall Street analysts have given a one-year price target of $40.89 on Apollo Global, which reflects the rise of 20.2% from the current market price, which is $34.01. However, the company raised its quarterly dividend payout, which could help it in recovering discounted valuations. The company declared a $0.39 per share quarterly payout in November 2017 while in February 2018 it was $0.66 per share. On February 28, 2018, the recent one would be paid. Apollo Global witnessed realizations of $4.7 billion in 4Q17.

Apollo Global’s EV-to-EBITDA ratio on an LTM (last-12-month) basis stood at 7.42x, while peers (XLF) Blackstone Group (BX), Carlyle Group (CG), and KKR & Company (KKR) have 16.76x, 12.05x and 53.57x, respectively, on an LTM basis.


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