On Monday, Citi resumed coverage on Blue Owl Capital (NYSE: OWL), issuing a Buy rating and establishing a price target of $21.00. The firm had previously suspended its rating on the company.
Following the release of Blue Owl Capital's first-quarter earnings for 2024, Citi expressed a positive outlook on the company's future, citing strong fundraising dynamics, especially in the Permanent Capital Vehicles (PVC) channel.
Blue Owl Capital's earnings power, diverse business mix, and permanent capital model were highlighted as key factors in Citi's assessment. The firm's positioning in the wealth management channel, where it is experiencing strong momentum, was also noted as a positive indicator. Moreover, Citi pointed to growth opportunities in the insurance channel, bolstered by recent acquisition announcements.
Citi's analysis suggests that Blue Owl Capital is well-positioned to generate significant growth. The analyst from Citi stated, "We continue to like OWL here given the embedded earnings power in the platform, its business mix, permanent capital model, positioning in the wealth channel where it is seeing good momentum, and growth opportunities in the insurance channel after recent acquisition announcements."
The analyst further expressed confidence in Blue Owl Capital's capability to deliver over 20% growth in both revenue and earnings in the coming years. This optimistic view is based on the company's current performance and strategic positioning within its various channels of operation.
Investors and market watchers will be observing how Blue Owl Capital performs against these expectations and whether the company can capitalize on the growth opportunities identified by Citi.
InvestingPro Insights
As Blue Owl Capital (NYSE: OWL) receives a renewed Buy rating from Citi with a $21.00 price target, insights from InvestingPro offer additional context to the company's financial health and growth potential.
InvestingPro data highlights a robust revenue growth of 24.87% for the last twelve months as of Q1 2024, with an even more impressive quarterly revenue growth of 31.29% for Q1 2024, reflecting the company's strong earnings power that Citi cited. Moreover, the company's gross profit margin stands at a healthy 59.96%, indicating efficient operations and cost management.
InvestingPro Tips further enrich the analysis with the knowledge that Blue Owl Capital has raised its dividend for 3 consecutive years, showcasing a commitment to shareholder returns. Additionally, the company's net income is expected to grow this year, reinforcing Citi's optimistic revenue and earnings growth projections.
For investors looking for more comprehensive analysis, there are additional InvestingPro Tips available, which can be accessed for deeper insights into Blue Owl Capital's performance and potential.
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