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Investing.com - Citizens downgraded KKR & Co. (NYSE:KKR) from Market Outperform to Market Perform, citing valuation concerns following the stock’s strong recovery since April.
KKR shares have risen 64% from their April lows, outpacing the 50% average gain seen across the rest of the group, according to Citizens analyst Devin Ryan, who previously maintained a $150 price target on the stock. The stock’s impressive 28% return over the past year reflects this strong momentum, though InvestingPro data shows four analysts have recently revised their earnings expectations downward.
The investment firm noted that KKR currently trades at approximately 50% above its 5-year historical average price-to-next-twelve-months earnings ratio, compared to about 20% for industry peers, suggesting limited room for further multiple expansion.
Citizens also expressed concern about earnings expectations, revealing its 2026 earnings per share estimate of $6.25 sits 6% below consensus and falls short of management’s $7-$8 target range. The firm highlighted that this estimate has declined approximately 10% since the beginning of the year.
The downgrade reflects Citizens’ view that the risk/reward balance for KKR has become more balanced following the recent price appreciation, with the firm suggesting that forward expectations may need to reset lower in coming months.
In other recent news, KKR has announced definitive agreements to acquire ProTen Pty Limited, an Australian poultry infrastructure firm, from Aware Super. The acquisition, made through KKR’s Asia Pacific Infrastructure Investors II Fund, is expected to close later this year, pending regulatory approvals. Financial terms of the deal were not disclosed. Meanwhile, KKR, along with Cinven and Providence, has hired Goldman Sachs to explore selling their 50% stake in the Spanish company Masorange, with the potential deal valued at €10 billion, including debt. Additionally, KKR’s takeover bid for UK healthcare-property investor Assura has not yet received any acceptances, despite raising its offer to a "best and final" price. In analyst news, Morgan Stanley (NYSE:MS) reiterated its Overweight rating on KKR, naming it a "Top Pick" amid a recovering capital market environment. Piper Sandler also initiated coverage on KKR with an Overweight rating, highlighting the firm’s strong position in private equity and growing insurance segment. Both analyst firms set a price target of $150 for KKR.
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