Apollo stock price target cut to $194 at Keefe Bruyette & Woods

On Wednesday, Keefe, Bruyette & Woods (KBW) adjusted its price target for Apollo Global Management (NYSE:APO), a leading global alternative investment manager. The new price target is set at $194.00, decreasing from the previous target of $196.00. Despite this slight reduction, the firm maintains an Outperform rating on the stock.

The adjustment followed Apollo’s recent financial outcomes, which included a beat on higher principal investing income and a lower tax rate. These positive factors were somewhat balanced by a decrease in reported subsidiary real estate equity (SRE) and an increase in the number of shares outstanding. The company’s solid performance is reflected in its $25.9 billion revenue and healthy gross profit margin of 41.75%. InvestingPro analysis indicates that Apollo’s current trading price suggests potential upside, with multiple analysts setting targets ranging from $167 to $214.

KBW has also revised its estimates for Apollo modestly downward by less than 1%. This revision is primarily due to a slightly lower forecasted growth in fee-related earnings (FRE), though there were no substantial changes to the SRE projections. The firm’s decision to maintain the Outperform rating indicates their continued positive outlook on Apollo’s stock despite the minor adjustments.

The updated price target of $194 reflects these nuanced changes in Apollo’s financial projections. The new target is a result of the firm’s analysis of various contributing factors, including the principal investing income and tax rate benefits, against the backdrop of lower SRE and a higher share count.

Keefe, Bruyette & Woods’ report underscores the firm’s detailed examination of Apollo’s financials and the resulting impact on their investment outlook. While the price target has been modestly reduced, the Outperform rating signals confidence in the investment management company’s potential for continued performance in the market.

In other recent news, Apollo Global Management has been the focus of several notable developments. JMP Securities maintained its Market Perform rating on Apollo, noting the company’s consistent execution and progress toward long-term goals. However, the firm’s earnings per share (EPS) estimates for 2025 and 2026 are below the consensus on Wall Street, indicating potential downside risk to broader market expectations.

In a separate development, Apollo unveiled a $5 billion multi-strategy credit fund with a 30-year maturity period. This innovative approach combines various types of investment-grade credits, offering a cost-effective method for insurers to make purchases while reducing regulatory capital requirements.

Meanwhile, Apollo’s wealth business has seen a record capital inflow, with assets surging 50%. The firm successfully raised $12 billion of capital from its global wealth business, moving closer to its ambitious target of $150 billion by 2029.

TD Cowen reaffirmed a Buy rating and a $227 price target for Apollo, citing potential benefits from a higher-for-longer interest rate environment. The firm’s analysts view the recent five-year employment agreement with CEO Marc Rowan as a positive development.

Lastly, Apollo announced a $500 million investment in Subordinated Notes issued by Aldar Properties PJSC, marking one of the largest corporate hybrid private placements in Abu Dhabi. This investment increases Apollo’s total investment in Aldar to approximately $1.9 billion since 2022.

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