Kohlberg Kravis Roberts
KKR
$86.21
-1.62%
KKR & Co. Inc. is one of the world's largest alternative asset managers, operating a two-segment platform that spans private markets (private equity, credit, infrastructure, energy, and real estate), public markets, and an insurance business built around Global Atlantic, with roughly $796.5 billion in total managed assets and $638.4 billion in fee-earning AUM as of June 2026. The firm is a scaled platform leader in alternatives rather than a niche specialist, distinguished by its permanent-capital insurance engine, its expanding private-credit franchise, and a multi-decade brand in large-cap buyouts. The current investor debate centers on whether KKR can sustain double-digit fee-related earnings growth as private credit enters the $14 trillion 401(k) market while simultaneously digesting a sharp de-rating in its shares, which have fallen roughly 27% over the past year against a 15.5% gain in the S&P 500. Recent headlines highlight both the opportunity (a Realty Income partnership and the opening of retirement channels to private credit) and the risk (a broad rotation away from rate-sensitive financials and concerns about AI-infrastructure financing exposure), leaving investors to weigh structural AUM compounding against cyclical pressure on realizations and carried interest.…
KKR
Kohlberg Kravis Roberts
$86.21
Related headlines
Investment Opinion: Should I buy KKR Today?
Rating: Buy (contrarian, medium conviction). The core thesis is that KKR's shares have de-rated 33.1% YTD to 11.7x forward EPS of $9.56 while the consensus rating remains 'buy' (mean 1.61) and the average target of $122.48 implies 42.1% upside — a dislocation created by cyclical fear rather than structural deterioration. The lowest analyst target of $97.00 still sits 12.5% above the current price, suggesting downside is well bracketed by fundamental value.
Supporting evidence: revenue grew 13.1% YoY in Q2 2026 to $5.66 billion, with Q2 EPS of $0.74 versus $0.53 a year earlier; fee-earning AUM of $638.4 billion and total AUM of $796.5 billion provide a durable fee base; TTM free cash flow is $2.34 billion; and the forward PE of 11.7x compares favorably to the trailing 50.8x and to the 3.67x price-to-book, implying the market is pricing a severe earnings haircut. The 42.1% upside to the average target and the 12.5% cushion to the lowest target frame an asymmetric risk/reward.
Risks and conditions: the biggest threats are a prolonged freeze in realizations (which would invalidate the $9.56 forward EPS), further multiple compression from the 1.83 beta and rate-sensitive rotation, and leverage of 1.77x debt-to-equity limiting flexibility. The rating would upgrade to a high-conviction Buy if Q3 2026 EPS tracks toward the $9.56 annual consensus and the stock holds above the $82.67 52-week low; it would downgrade to Hold if forward EPS estimates are cut below $8.00 or if the shares break below $82.67 on rising volume. Valuation verdict: undervalued relative to forward earnings and analyst targets, but fairly-to-richly valued on trailing book and sales, so the case rests on the earnings recovery.
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KKR 12-Month Price Forecast
The forward-looking view is cautiously bullish because the valuation already discounts a severe earnings disappointment: at 11.7x forward EPS of $9.56, KKR trades at a fraction of its 50.8x trailing multiple, and the $122.48 average target implies 42.1% upside. The Q2 2026 inflection — 13.1% revenue growth and EPS more than doubling YoY — supports the recovery narrative, while $638.4 billion of fee-earning AUM and the Global Atlantic permanent-capital engine provide a durable fee floor. The main risk is that the $9.56 consensus proves too optimistic if realizations stay frozen, in which case the stock could retest $82.67. I would upgrade to high confidence if Q3 2026 EPS tracks toward the annual consensus, and downgrade to neutral if forward estimates are cut below $8.00 or the shares break the 52-week low.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Kohlberg Kravis Roberts's 12-month outlook, with a consensus price target around $122.05 and implied upside of +41.6% versus the current price.
Average Target
$122.05
0 analysts
Implied Upside
+41.6%
vs. current price
Analyst Count
—
covering this stock
Price Range
$97 - $166
Analyst target range
Bulls vs Bears: KKR Investment Factors
The bear case currently has stronger near-term evidence: KKR is down 33.1% YTD, trades 4.3% above its 52-week low, and has underperformed the S&P 500 by 42.2 percentage points over twelve months, with trailing profitability near zero and a beta of 1.83 amplifying the sell-off. However, the bull case rests on a powerful forward inflection — consensus EPS of $9.56 implies an 11.7x forward multiple, and the average analyst target of $122.48 implies 42.1% upside. The single most important tension is whether the forward earnings recovery (driven by realizations and carried interest) actually materializes; if it does, the stock is deeply undervalued, but if capital-markets activity stays frozen, the trailing 50.8x PE is a warning rather than an anomaly.
Bullish
- Analyst targets imply 42% upside: With 21 analysts covering KKR and a consensus recommendation of 'buy' (mean 1.61), the average price target of $122.48 sits 42.1% above the current $86.21. Even the lowest analyst target of $97.00 is 12.5% above the current price, suggesting the sell-off has overshot fundamental expectations.
- Forward EPS of $9.56 vs trailing $0.02: Consensus estimated EPS of $9.56 for the forward period versus trailing EPS of just $0.02 implies an enormous earnings recovery, driven by normalization of carried interest and realizations. On forward earnings, KKR trades at only 11.7x, a steep discount to its historical multiple and to the trailing PE of 50.8x.
- Revenue growth reaccelerated to 13.1% YoY: Q2 2026 revenue of $5.66 billion grew 13.1% year-over-year versus $5.00 billion in Q2 2025, and rose 33% sequentially from Q1 2026's $4.25 billion. Q2 EPS of $0.74 also more than doubled the prior-year $0.53, showing the earnings engine is inflecting.
- Private credit entering $14T 401(k) market: The opening of the $14 trillion 401(k) market to private credit is a structural fee-income tailwind for scaled alternatives managers like KKR, which already manages $638.4 billion in fee-earning AUM. The Realty Income partnership announced in September 2026 adds another capital-light deployment channel.
Bearish
- Stock down 26.6% in a year, -33.1% YTD: KKR has fallen 26.6% over the past year against a 15.5% gain in the S&P 500, a relative strength gap of -42.2 percentage points. Year-to-date the stock is down 33.1% versus the S&P's +11.9%, and it sits just 4.3% above its 52-week low of $82.67, indicating persistent distribution.
- Trailing profitability is razor-thin: Trailing EPS is $0.02, trailing PE is 50.8x, and the operating margin is only 2.55% with a net margin of 12.3%. The Q1 2025 quarter posted a net loss of -$185.9 million and negative gross profit, illustrating how volatile GAAP earnings are for this business model.
- Leverage and cash-flow quality concerns: Debt-to-equity stands at 1.77x and the price-to-cash-flow ratio is an extreme 237.6x, while free cash flow TTM of $2.34 billion is modest relative to the $113.5 billion market cap. The dividend yield of just 0.68% offers little income support during drawdowns.
- High beta amplifies macro rotation: KKR's beta of 1.83 means it is nearly twice as volatile as the market, and the recent rotation away from rate-sensitive financials has hit the shares hard (-11.0% in the past month versus +1.2% for the S&P). AI-infrastructure financing exposure adds a new source of headline risk.
KKR Technical Analysis
Beta
1.83
1.83x market volatility
Max Drawdown
-43.8%
Largest decline past year
52-Week Range
$83-$145
Price range past year
Annual Return
-26.6%
Cumulative gain past year
| Period | KKR Return | S&P 500 |
|---|---|---|
| 1m | -11.0% | +0.2% |
| 3m | -14.6% | +2.9% |
| 6m | -16.8% | +8.4% |
| 1y | -26.6% | +14.9% |
| ytd | -33.1% | +11.9% |
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KKR Fundamental Analysis
Quarterly Revenue
$5.7B
2026-06
Revenue YoY Growth
+13.1%
YoY Comparison
Gross Margin
18.9%
Latest Quarter
Free Cash Flow
$2.3B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is KKR Overvalued?
PE
50.8x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 8x~63x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
16.5x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks center on earnings quality and leverage. Trailing EPS of $0.02 and a 50.8x trailing PE contrast sharply with the $9.56 forward EPS consensus, meaning the entire investment case depends on a violent recovery in realizations and carried interest. Operating margin is only 2.55% and net margin 12.3%, and Q1 2025 actually produced a net loss of -$185.9 million with negative gross profit, demonstrating quarter-to-quarter earnings volatility. Debt-to-equity of 1.77x and a price-to-cash-flow ratio of 237.6x leave little cushion if cash generation (TTM FCF of $2.34 billion) disappoints, and the 0.68% dividend yield provides minimal income support.
Market and competitive risks are elevated by valuation and positioning. KKR's beta of 1.83 makes it highly sensitive to rate and risk-appetite swings, and the stock has already fallen 11.0% in the past month while the S&P rose 1.2%, a -12.2 point relative move. The rotation away from rate-sensitive financials, concerns about AI-infrastructure financing exposure highlighted by Nvidia's $500 billion financing plan, and competition from Blackstone and Apollo in private credit and 401(k) channels all threaten fee growth. A premium multiple (3.67x book, 5.91x sales) leaves room for further de-rating if growth expectations slip.
Worst-case scenario: capital markets remain closed, realizations stall, carried interest fails to materialize, and the forward EPS consensus of $9.56 is cut materially. In that chain of events, the stock could retest its 52-week low of $82.67 (only 4.1% below the current $86.21) and, in a deeper risk-off episode, approach the analyst low target of $97.00 is actually above the current price, so the more relevant downside anchor is the 52-week low and the -43.8% maximum drawdown already experienced. From $86.21, a move to the 52-week low implies roughly -4%, while a repeat of the historical max drawdown would imply a decline toward the low-$50s, or roughly -35% to -40%.
FAQ
The most severe risk is earnings quality: trailing EPS of $0.02 versus $9.56 forward consensus means any delay in realizations or carried interest could force estimate cuts. Second is valuation and volatility risk — a 1.83 beta and 3.67x price-to-book leave the stock exposed to rate-sensitive rotation, already visible in the -11.0% one-month move versus +1.2% for the S&P. Third is balance-sheet leverage at 1.77x debt-to-equity with a 237.6x price-to-cash-flow ratio, limiting flexibility if cash flow disappoints. Fourth is company-specific headline risk around AI-infrastructure financing exposure and competition from Blackstone and Apollo in private credit and 401(k) channels.
The 12-month forecast has three scenarios: a 30% probability bull case of $122-$166 if realizations normalize and EPS approaches $9.56; a 50% probability base case of $97-$122 as earnings recover gradually and the stock grinds toward the analyst average target of $122.48; and a 20% probability bear case of $82-$97 if capital markets stay frozen and estimates are cut. The base case is most likely, anchored on the $9.56 forward EPS consensus and the 11.7x forward multiple holding. The key assumption is that fee-related earnings from $638.4 billion of fee-earning AUM provide a floor while carried interest recovers.
KKR looks undervalued on forward earnings but expensive on trailing and book metrics. The forward PE of 11.7x on $9.56 consensus EPS is well below the 50.8x trailing PE, while price-to-book of 3.67x and price-to-sales of 5.91x are premium multiples that assume continued AUM growth. The market appears to be pricing a severe earnings haircut — the gap between $0.02 trailing EPS and $9.56 forward EPS is the entire valuation debate. If the consensus is achieved, the stock is cheap; if estimates are cut, the premium book and sales multiples leave room for further de-rating. Net-net, the forward multiple suggests the market expects a recovery but is not yet willing to pay for it.
From a risk/reward perspective, KKR offers 42.1% upside to the $122.48 average analyst target against limited downside to the $82.67 52-week low, only about 4% below the current $86.21. The 11.7x forward PE on $9.56 consensus EPS is inexpensive for a franchise with $638.4 billion in fee-earning AUM and 13.1% Q2 revenue growth. However, the trailing 50.8x PE and $0.02 trailing EPS show how dependent the thesis is on an earnings recovery, and the 1.83 beta means sharp drawdowns are likely. It is a good buy for patient, risk-tolerant investors with a 2-3 year horizon who can withstand a retest of the 52-week low, but less suitable for income or low-volatility portfolios given the 0.68% yield.
KKR is better suited to long-term holding than short-term trading. Its 1.83 beta, -43.8% maximum drawdown, and 33.1% YTD decline make short-term price action highly unpredictable, while the structural growth drivers — $796.5 billion AUM, private credit entering the $14 trillion 401(k) market, and the Global Atlantic permanent-capital engine — compound over years. The 0.68% dividend yield offers little income, so returns depend on capital appreciation and the earnings recovery embedded in the $9.56 forward EPS. A minimum holding period of 2-3 years is appropriate to ride out realization cycles and allow the forward earnings recovery to materialize.