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On Monday, TD Cowen maintained a bullish outlook on Blue Owl Capital (NYSE:OWL), increasing its price target on the company’s shares from $28.00 to $30.00 while sustaining a Buy rating. The $13.35 billion alternative asset manager, currently trading at $23.49, shows mixed signals with a high P/E ratio of 117x. The adjustment comes in the wake of Blue Owl’s fourth-quarter results released on February 6 and the insights shared during the firm’s investor day on February 7. According to InvestingPro analysis, the stock appears undervalued based on its proprietary Fair Value model.
Analysts at TD Cowen expressed confidence in Blue Owl Capital’s prospects, citing several factors that underpin their positive stance. The company has demonstrated strong momentum with a 40.39% price return over the past six months and impressive revenue growth of 32.56% in the last twelve months. They highlighted the company’s impressive performance in Digital Infrastructure and Global Wealth Management (GWM) as key elements of their analysis. The firm’s comprehensive update led analysts to adjust their 2025-2026 adjusted total distributable earnings (A/T DE) estimates upward.
The report also pointed out that despite Blue Owl’s recent stock price decline following the announcements, there are eight critical themes that support a bullish view. These include the reinforcement of the "4 D Drivers" which were initially presented on January 16, signifying durability, duration, diversification, and duplicative franchise scaling.
TD Cowen also noted the significant growth potential within the large and relatively untapped total addressable markets (TAMs) that Blue Owl operates in. They believe that the company is well-positioned to benefit from multiple vectors of growth. Furthermore, the analysts acknowledged that management has mitigated several financial risks that have previously impacted the stock over the past year.
The report outlined additional positive developments such as a clear trajectory for successor fund growth, reduced credit risk concerns, a shift in financial framework perception, and a strategic focus on long-term valuation into 2029. TD Cowen also emphasized the trend that larger alternative asset managers are likely to capture a disproportionate share of the market, particularly in areas such as GWM and Insurance. InvestingPro subscribers can access detailed financial health metrics and 8 additional ProTips for Blue Owl Capital, along with comprehensive research reports that provide deeper insights into the company’s growth trajectory and market positioning.
In other recent news, Blue Owl Capital’s Distributable Earnings (DE) per share of $0.21 fell short of the anticipated $0.22, despite a record quarter of capital raising totaling $13.4 billion in direct originations. JPMorgan maintained its Neutral rating on Blue Owl, with a steady price target of $23.00. JMP Securities, however, raised its price target for Blue Owl to $32.00, while Citi analysts reinstated coverage of the company with a Buy rating and a price target of $30.00.
In a significant development, Pagaya (NASDAQ:PGY) Technologies entered into a forward flow agreement with Blue Owl to acquire up to $2.4 billion in consumer loans over the next 24 months. This strategic alliance aims to enhance Pagaya’s capital efficiency and diversify its funding sources. Citi analyst Peter Christiansen upgraded Pagaya Tech to Buy, adjusting the price target to $14.50 from $13.00, citing factors such as increased network volume and potential for positive GAAP net income in the fiscal year 2025.
These are the recent developments for both Blue Owl Capital and Pagaya Technologies, as they continue to navigate the financial landscape and capitalize on growth opportunities.
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