KKR (KKR) is positioned to benefit from a "K-shaped" bifurcation in the alternative asset management industry, where larger diversified managers are gaining share, supported by a fundraising supercycle expected to extend through 2027, RBC Capital Markets said.
Management said macro volatility could make its $7 per share guidance difficult to achieve, particularly as exits are delayed. However, RBC said in a Tuesday note that its estimates and consensus already reflected a lower baseline of about $6 per share heading into the quarter, helping reset expectations positively.
The firm said KKR is benefiting from a fundraising supercycle driven by a secular shift in which limited partners are consolidating relationships with fewer general partners. This dynamic is reinforcing a "K-shaped" industry structure that favors large, diversified alternative asset managers.
RBC also highlighted KKR's portfolio company employee ownership program, noting a strong outcome from the sale of CoolIT at a 15x exit multiple. The firm said the program, now implemented across 85 portfolio companies, has supported higher employee retention, stronger revenue growth, and margin expansion.
The firm maintained an outperform rating on KKR and lowered its price target to $128 from $132.
Price: $101.08, Change: $-0.92, Percent Change: -0.91%