Wells Fargo has maintained an Overweight rating on Apollo Global Management (NYSE: NYSE:APO) and increased its price target to $148.00, up from the previous $132.00.
The firm believes there is further growth potential for the stock, which has already seen significant gains.
Apollo Global Management's shares have outperformed the market with a 23.7% increase since September 10, 2024, compared to a 3.9% rise in the S&P 500.
Wells Fargo's assessment indicates that there are several factors that could contribute to continued growth and multiple expansion for Apollo Global.
Key elements supporting the positive outlook include Apollo Global's new five-year targets, which suggest that the company's mid-teens or higher long-term earnings per share (EPS) growth profile remains solid.
Additionally, the expectation of ongoing margin expansion and a shift toward a higher-valued fee-related earnings (FRE) mix contribute to the firm's optimistic stance.
In other recent news, Apollo Global Management has been the center of several key developments. JPMorgan has raised Apollo's shares price target to $143.00 from $129.00, maintaining an Overweight rating.
The adjustment follows Apollo's investor day where new targets were set for 2029, including a 20% average fee-related earnings growth and a 10% average strategic real estate growth over the next five years. Goldman Sachs also maintained its Buy rating on Apollo Global, setting a target price of $135.
TD Cowen reiterated a Buy rating on Apollo shares, projecting about $15.00 in after-tax net income for the year 2029, driven by quicker than expected growth in fee-related earnings. Apollo has also proposed a significant investment of up to $5 billion in Intel (NASDAQ:INTC) and initiated a strategic financing and capital markets collaboration with BNP Paribas (OTC:BNPQY), which committed an initial $5 billion in financing.
Furthermore, Apollo established a $25 billion private credit and direct lending program in partnership with Citigroup Inc (NYSE:C). Barclays analysts have maintained an Overweight rating on Apollo while Wolfe Research recently initiated coverage with an Outperform rating, reflecting Apollo’s robust position in the Private Credit and Fixed-Deferred Annuity markets.
InvestingPro Insights
Apollo Global Management's recent performance aligns with Wells Fargo's optimistic outlook. According to InvestingPro data, the company's stock is trading near its 52-week high, with a price at 99.22% of its peak. This strength is reflected in the impressive year-to-date price total return of 43.36% and a one-year return of 49.85%, significantly outpacing the S&P 500's performance mentioned in the article.
InvestingPro Tips highlight Apollo's position as a prominent player in the Financial Services industry, with a solid track record of maintaining dividend payments for 14 consecutive years. This consistency may appeal to income-focused investors, although the current dividend yield stands at a modest 1.4%.
The company's P/E ratio of 14.19 suggests that despite the recent price surge, the stock may still offer value relative to its earnings. This aligns with Wells Fargo's view that a mid-teens earnings multiple is reasonable for Apollo Global Management.
For readers interested in a deeper analysis, InvestingPro offers 12 additional tips for Apollo Global Management, providing a more comprehensive view of the company's financial health and market position.
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