Assessing Apollo Global Management (APO) Valuation After Analyst Upgrades and Reaffirmed Growth Targets
Apollo Global Management (APO) is back in the spotlight after management reiterated ambitious growth targets ahead of high profile conferences, while fresh analyst upgrades and a Bank of England stress test lifted investor attention.
See our latest analysis for Apollo Global Management.
Those upbeat growth messages and conference appearances seem to be resonating, with a 7 day share price return of 4.76% and the stock now trading at $138.13, even though the year to date share price return remains negative. The 1 year total shareholder return of negative 21.24% shows how sentiment has only recently started to recover from a tougher stretch, despite a strong 3 year total shareholder return of 131.27% and 5 year total shareholder return of 222.99% that still underline the longer term compounding story.
If this kind of renewed momentum has you thinking more broadly about opportunities, it could be a smart time to scan fast growing stocks with high insider ownership for other under the radar compounders.
Yet with Apollo trading below analyst targets and at a sizeable intrinsic discount, but coming off a double digit yearly loss, investors face a pivotal question: is this a mispriced compounder, or is future growth already fully reflected?
Most Popular Narrative Narrative: 12.7% Undervalued
Apollo Global Management's most followed narrative points to a fair value of $158.22 versus the last close at $138.13, setting up a double digit implied upside.
The analysts have a consensus price target of $161.856 for Apollo Global Management based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $178.0, and the most bearish reporting a price target of just $117.7.
Want to see what justifies paying up for a financial stock facing steep revenue declines yet soaring profitability expectations, plus a richer future earnings multiple than peers? The narrative leans on bold earnings expansion, margin transformation and a valuation reset that assumes markets will keep rewarding this shift. Curious which specific financial levers do the heavy lifting in that fair value math, and how sensitive the outcome is to those forecasts? The full narrative breaks down the numbers driving that optimistic price tag.
Result: Fair Value of $158.22 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, internal execution missteps or intensifying competition in insurance and private credit could quickly challenge the optimistic growth and valuation assumptions that underpin this narrative.
Find out about the key risks to this Apollo Global Management narrative.
Build Your Own Apollo Global Management Narrative
If you see the story differently or want to dig into the numbers yourself, you can build a personalized view in just a few minutes: Do it your way.
A great starting point for your Apollo Global Management research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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