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Redburn Atlantic is bullish on the outlook for the private markets space, assigning new Buy ratings to some of the industry’s “scale players,” including Apollo Global Management (NYSE:APO), Carlyle Group (NASDAQ:CG) and KKR (NYSE:KKR).
Analyst Nicholas Watts expects private markets to continue to be the fastest-growing segment of global financial services, driven by a variety of ongoing (businesses staying private for longer) and emerging (fixed-income replacement) trends.
“The industry’s scale players are benefiting from: (1) institutions consolidating their supplier relationships; (2) brand recognition and the resources to support growth in the largely untapped wealth channel; and (3) investment capacity to seed product and asset class expansion,” Watts wrote in a note.
Thanks in part to the industry’s long-dated investment approach, the analyst anticipates private markets to continue to deliver superior risk-adjusted returns to investors. “As the industry expands, origination capability should become more important, and we expect this to be a critical performance differentiator.”
Seeking Alpha’s Peer tab compares numerous metrics of the aforementioned private-market players.
In late morning trading, (APO) edged up 0.8%, and (CG) and (KKR) each slipped 0.2%,
