New York-based KKR & Co. Inc. (KKR) is a leading investment firm with a market cap of $108.1 billion. It specializes in private equity and real estate investments, along with strategies across credit, infrastructure, and growth equity.
This asset management company has underperformed the broader market over the past 52 weeks. Shares of KKR have declined 19.5% over this time frame, while the broader S&P 500 Index ($SPX) has gained 12.7%. Moreover, on a YTD basis, the stock is down 18%, compared to SPX’s 14.4% return.
Narrowing the focus, KKR has also lagged behind the Invesco Global Listed Private Equity ETF’s (PSP) 5.6% drop over the past 52 weeks and 1.4% YTD loss.
Shares of KKR surged 1.7% after its Q3 earnings release on Nov. 7. The company reported strong growth in insurance revenue, which helped offset weaker performance in asset management and strategic holdings. Overall, its top line improved 15.3% year-over-year to $5.5 billion. Moreover, its fee-related earnings reached a record $1 billion, while its assets under management grew 15.8% from the year-ago quarter to $723.2 billion. On the earnings front, its adjusted net income per share of $1.41 climbed 6.8% from the same period last year, reflecting continued business expansion and strong operating performance.
For the current fiscal year, ending in December, analysts expect KKR’s EPS to grow 16.2% year over year to $4.53. The company’s earnings surprise history is mixed. It exceeded the consensus estimates in two of the last four quarters, while missing on two other occasions.
Among the 21 analysts covering the stock, the consensus rating is a "Strong Buy,” which is based on 16 “Strong Buy,” two "Moderate Buy,” and three "Hold” ratings.
This configuration is slightly more bullish than two months ago, with 15 analysts suggesting a “Strong Buy” rating.
On Nov. 3, Barclays PLC (BCS) maintained an "Overweight" rating on KKR, but lowered its price target to $151, indicating a 24.5% potential upside from the current levels.
The mean price target of $156.90 represents a 29.3% premium from KKR’s current price levels, while the Street-high price target of $188 suggests an ambitious upside potential of 55%.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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