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On Tuesday, TD Cowen maintained a positive stance on Blue Owl Capital (NYSE: OWL) shares, reiterating a Buy rating and a $30.00 price target. Analysts at the firm highlighted the company's resilient business model, which they believe stands out in the sector despite the stock's ~29% year-to-date decline. This performance is roughly in line with peers and reflects broader market trends rather than company-specific weaknesses. According to InvestingPro data, the company appears undervalued based on its Fair Value analysis, with analyst targets ranging from $17 to $32 per share.
The firm's analysts emphasized the value proposition of Blue Owl Capital's stock, which is currently trading at approximately 14.5 times their 2026 earnings estimate and offers a forward twelve-month dividend yield of 4.4%. They consider the stock to be particularly inexpensive and maintain their Buy rating. InvestingPro data shows the company has raised its dividend for 4 consecutive years, with impressive dividend growth of 28.6% over the last twelve months. The company maintains strong financial health with a current ratio of 1.79, indicating liquid assets exceed short-term obligations. Despite short-term pressures linked to the macroeconomic environment, TD Cowen's analysts are confident in the company's long-term growth prospects.
The analysts noted that Blue Owl Capital's stock has not been adequately differentiated in the market, which suggests a buyers' strike amid macroeconomic uncertainties. Recent InvestingPro data reveals the stock has experienced significant pressure, declining nearly 20% in just the past week. However, following a management meeting sponsored by TD Cowen, the firm remains constructive on the company's future. They see potential in Blue Owl Capital's ability to grow and diversify, with revenue growth of 32.6% over the last twelve months supporting this view. The company maintains a favorable ratio of fee-related earnings to distributable earnings and a strong skew towards permanent capital in assets under management.
Blue Owl Capital's stock has not performed as well as some might expect given the company's robust business model, which is considered one of the most resilient in the sector. This underperformance may be attributed to the current macroeconomic climate, which has made investors more cautious.
In summary, TD Cowen's analysis suggests that Blue Owl Capital is undervalued at its current stock price, given its strong fundamentals and attractive dividend yield. The firm's analysts believe that the company's long-term growth trajectory and financial health make it a compelling investment, despite the short-term headwinds affecting the broader market.
In other recent news, Blue Owl Capital has seen several notable developments. CFRA analyst Kenneth Leon initiated coverage on Blue Owl Capital with a Buy rating and set a price target of $27, citing strong growth expectations and favorable valuation metrics compared to peers. The analyst forecasts earnings per share to reach $0.90 in 2025 and $1.10 in 2026, with revenue projected at $2.8 billion and $3.4 billion for the respective years. Additionally, Blue Owl Capital announced the appointment of Jennifer Brouse to its Board of Directors, following the resignation of Sean Ward. In a move to strengthen its global presence, Blue Owl named Blake Shorthouse as the Global Head of Family Capital, and Rosamond Price as Managing Director and Head of Private Wealth for EMEA. The firm continues to expand its leadership team to enhance its offerings in private markets and wealth management. Furthermore, Blue Owl's subsidiary, Wingspire Equipment Finance, provided a $30 million capital lease to an IT managed service provider, highlighting Blue Owl's ongoing support for digital transformation initiatives. These updates reflect Blue Owl Capital's strategic efforts to bolster its market position and expand its services.
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