Could Investor Interest in Alternatives Change Analysts’ Ratings?


Jul. 27 2018, Updated 10:31 a.m. ET

No change in ratings

In the previous part of this series, we saw that Apollo Global Management (APO) has premium valuations. Its inflows might be higher in the second quarter since active asset managers have gained investor interest in recent months. The Blackstone Group’s (BX) inflows rose sequentially in the second quarter.

The ratings for Apollo Global Management haven’t changed over the past few months. The company has “strong buy” ratings from the five of the 15 analysts covering the stock in July. Three have given it a “hold,” and seven have rated it a “buy.”

Analysts have given Apollo a one-year price target of $39.58, which implies a rise of 10.4% from its current price of $35.85.

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What about its competitors?

In the first quarter, Blackstone Group saw inflows of $18.2 billion, Carlyle Group (CG) raised $7.7 billion, and Apollo saw $4.9 billion of inflows. In the second half of 2018, the traditional asset managers (XLF) could witness outflows, mainly due to expectations of volatile equity markets amid trade worries.

KKR & Co. (KKR) has “hold” ratings from three of the 12 analysts covering the stock in July. Five analysts have given it a “buy” rating, and four are recommending a “strong buy.” It has a one-year price target of $30.54.


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