Carlyle Group
CG
$49.28
-4.14%
The Carlyle Group Inc. is a global alternative asset management firm, operating across private equity, credit, and investment solutions, with $476.9 billion in total assets under management as of the end of 2025. As one of the world's largest alternative-asset managers, Carlyle is a market leader serving institutional investors and high-net-worth individuals through a diversified platform spanning global private equity, global credit, and Carlyle AlphInvest. The current investor narrative centers on the firm's strategic expansion into wealth management and asset-backed finance, as evidenced by recent acquisitions, while the stock faces near-term technical headwinds and a challenging market environment for alternative asset managers.…
CG
Carlyle Group
$49.28
Related headlines
Investment Opinion: Should I buy CG Today?
We rate CG as a Hold. The stock is trading at $48.88, with an average analyst target of $55.59, implying 13.7% upside, but the recent earnings collapse and negative cash flow warrant caution. The forward PE of 9.61x suggests the market expects a recovery, but the risk of disappointment is high given the volatile revenue stream.
Sign up to view all
CG 12-Month Price Forecast
The AI assessment is neutral with medium confidence. The forward PE suggests the stock is undervalued if earnings recover, but the recent revenue collapse and negative cash flow introduce significant uncertainty. The analyst consensus is bullish, but the wide target range (44-70) reflects high dispersion in expectations. I would upgrade to bullish if Q2 2026 shows a clear earnings rebound and positive FCF, and downgrade to bearish if revenue continues to decline or if the company cuts its dividend.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Carlyle Group's 12-month outlook, with a consensus price target around $58.06 and implied upside of +17.8% versus the current price.
Average Target
$58.06
0 analysts
Implied Upside
+17.8%
vs. current price
Analyst Count
—
covering this stock
Price Range
$49 - $73
Analyst target range
The target price range spans from a low of $44.00 to a high of $70.00, representing a wide spread of $26, which signals significant uncertainty about the company's future performance. The low target of $44.00 suggests a potential downside of -10% from current levels, likely pricing in continued weakness in fundraising and investment income, while the high target of $70.00 implies a +43% upside, reflecting optimism about a strong recovery in performance fees and successful strategic initiatives. Recent institutional actions show a mix of ratings, with TD Cowen downgrading from Buy to Hold in May 2026, but most firms maintaining their positions, indicating a cautiously optimistic outlook with notable risks.
Bulls vs Bears: CG Investment Factors
Carlyle presents a classic high-risk, high-reward scenario. The bull case rests on a massive AUM base, a low forward PE, and strategic expansion into wealth management, while the bear case is driven by a 76.5% revenue collapse, negative FCF, and persistent underperformance. Currently, the bearish evidence is stronger given the recent earnings deterioration and negative cash flow, but the forward PE suggests the market is pricing in a recovery. The single most important tension is whether Carlyle can return to profitable growth, as the entire bull thesis depends on a rebound in performance fees and investment income. If the recovery stalls, the stock could fall to the 52-week low of $39.60, representing a -19% downside from current levels.
Bullish
- Massive AUM base of $476.9B: Carlyle manages $476.9B in total AUM, including $336.8B in fee-earning AUM, providing a stable base of management fees that supports the business through market cycles. This scale positions the firm to generate significant fee income even when performance fees are volatile.
- Forward PE of 9.6x implies recovery: The forward PE of 9.61x suggests the market expects a substantial earnings rebound, with analysts forecasting EPS of $6.18 for the next fiscal year. If realized, this would represent a dramatic recovery from the current negative trailing earnings, offering significant upside if the recovery materializes.
- Analyst consensus is Buy with 13.7% upside: The average analyst target price is $55.59, implying a 13.7% upside from the current price of $48.88. With 17 analysts covering the stock and a mean recommendation of 2.24 (Buy), the sell-side remains optimistic about Carlyle's strategic direction.
- Strategic expansion into wealth management: The acquisition of MAI in March 2026 expands Carlyle's presence in high-net-worth wealth management, a high-growth channel for alternative assets. This move diversifies the investor base and could drive long-term AUM growth, as evidenced by the multibillion-dollar deal.
Bearish
- Revenue collapsed 76.5% YoY in Q1 2026: Q1 2026 revenue fell to $189.6M, down 76.5% from $807.8M in Q1 2025, driven by negative performance allocations and a net loss of -$132.2M. This dramatic decline highlights the extreme volatility of performance-related revenue, which is a core component of Carlyle's earnings.
- Stock underperformed S&P 500 by 43.7% over 1 year: CG returned -22.3% over the past year versus the S&P 500's +21.5%, a relative underperformance of -43.7%. This persistent underperformance reflects investor concerns about the company's earnings power and the challenging environment for alternative asset managers.
- High beta of 1.83 amplifies market risk: With a beta of 1.83, CG is significantly more volatile than the market, meaning it tends to fall more in downturns. This amplifies downside risk in a market correction, as evidenced by the stock's 41.6% max drawdown over the past year.
- Negative free cash flow of -$917.8M TTM: Carlyle generated -$917.8M in free cash flow over the trailing twelve months, indicating that the company is burning cash. This is partly due to investment activities, but it raises concerns about the sustainability of its dividend and ability to fund growth initiatives without additional debt.
CG Technical Analysis
The stock is in a clear downtrend over the past year, with a 1-year price change of -22.29%, significantly underperforming the S&P 500's +21.46% gain. The current price of $48.88 sits at 70% of the 52-week range (low of $39.60, high of $69.85), indicating the stock is closer to its lows than highs, reflecting persistent selling pressure and a bearish long-term trend. The 6-month price change of -16.74% further confirms the downtrend, with the stock having made a series of lower lows and lower highs since February 2026.
Beta
1.82
1.82x market volatility
Max Drawdown
-41.6%
Largest decline past year
52-Week Range
$40-$70
Price range past year
Annual Return
-24.1%
Cumulative gain past year
| Period | CG Return | S&P 500 |
|---|---|---|
| 1m | +6.9% | +2.9% |
| 3m | +2.6% | +5.0% |
| 6m | -9.6% | +13.9% |
| 1y | -24.1% | +20.4% |
| ytd | -19.0% | +13.8% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
CG Fundamental Analysis
Revenue has been highly volatile, with the most recent quarter (Q1 2026) showing a dramatic decline to $189.6 million, down 76.53% year-over-year, compared to $807.8 million in Q1 2025. This sharp drop is driven by a collapse in performance allocations and principal investment income, as the firm reported negative performance allocations of -$1.1 million and a net loss of -$132.2 million. Over the trailing twelve months, revenue has been erratic, with Q4 2025 revenue of $1.84 billion being unusually high due to a surge in incentive fees and investment income, but the overall trend is one of significant volatility and recent deterioration.
Quarterly Revenue
$189600000.0B
2026-03
Revenue YoY Growth
-76.5%
YoY Comparison
Gross Margin
N/A
Latest Quarter
Free Cash Flow
$-917800000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is CG Overvalued?
Given the negative trailing net income (TTM net income is -$132.2 million), the price-to-earnings ratio is not meaningful, so I selected the price-to-sales ratio as the primary valuation metric. The current PS ratio is 4.34x, which is elevated relative to the company's historical average, but the forward PE of 9.61x suggests the market expects a significant earnings recovery. The gap between the trailing PS and forward PE implies that analysts anticipate a substantial rebound in profitability, which is a key risk if the recovery fails to materialize.
PE
26.3x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 4x~33x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
23.9x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks are substantial. Carlyle's revenue is highly volatile, with Q1 2026 revenue down 76.5% YoY and a net loss of -$132.2M, reflecting the cyclicality of performance fees. The company's free cash flow is deeply negative at -$917.8M TTM, and its debt-to-equity ratio of 2.41 indicates high leverage, which could strain the balance sheet if earnings remain depressed. Additionally, the dividend yield of 2.38% may be at risk if cash flow does not improve, given the payout ratio of 62.5% on negative earnings.
FAQ
The key risks are: 1) Financial risk: negative free cash flow of -$917.8M TTM and high debt-to-equity of 2.41, which could lead to dividend cuts or financial distress. 2) Market risk: high beta of 1.83 means the stock is more volatile than the market, and the 41.6% max drawdown shows the potential for large losses. 3) Competitive risk: the alternative asset management industry is highly competitive, and Carlyle may lose market share to larger peers like Blackstone. 4) Company-specific risk: the recent revenue collapse of 76.5% YoY highlights the unpredictability of performance fees. The most severe risk is a prolonged earnings downturn, which could push the stock to the 52-week low of $39.60, a -19% downside from current levels.
The 12-month forecast is mixed. The bull case (25% probability) targets $60-$70, driven by a strong earnings recovery and successful strategic initiatives. The base case (50% probability) targets $50-$58, in line with the average analyst target of $55.59. The bear case (25% probability) targets $40-$44, approaching the 52-week low of $39.60, if the recovery fails. The most likely scenario is the base case, which assumes a moderate recovery in performance fees and AUM growth. However, the wide range of analyst targets (44-70) reflects significant uncertainty.
CG is trading at a forward PE of 9.61x, which is below the historical average for the company and the broader asset management sector, suggesting it is undervalued if earnings recover. However, the trailing PE is not meaningful due to negative earnings, and the PS ratio of 4.34x is elevated relative to history. The market is pricing in a significant earnings rebound, as evidenced by the gap between the trailing PS and forward PE. If the recovery fails, the stock could be overvalued. Overall, the valuation is reasonable only if you believe in the earnings recovery.
CG is a high-risk, high-reward stock. The average analyst target of $55.59 implies 13.7% upside, but the stock has underperformed the market by 43.7% over the past year. The forward PE of 9.61x suggests the market expects a recovery, but the recent revenue collapse and negative free cash flow of -$917.8M TTM are major red flags. It could be a good buy for investors who believe in the earnings recovery and are willing to tolerate significant volatility, but it is not suitable for conservative investors. A better entry point might be near the 52-week low of $39.60, which would offer a margin of safety.
CG is more suitable for long-term investment, given its cyclical nature and the time required for the earnings recovery to play out. The stock's high beta of 1.83 and 41.6% max drawdown make it unsuitable for short-term trading unless you have a high risk tolerance. The dividend yield of 2.38% provides some income, but the payout ratio of 62.5% on negative earnings suggests the dividend could be cut. A minimum holding period of 3-5 years is recommended to allow the company to execute its strategic plan and for performance fees to recover. Short-term traders may find opportunities in the stock's volatility, but the risk is high.