Private Credit Market Attracts Investors as KKR Raises $2.5 Billion
Written by Emily J. Thompson, Senior Investment Analyst
Source: CNBC
- Investor Confidence: Despite warnings of increased borrower stress and looser loan approvals, the private credit market continues to attract investors, with KKR recently completing a $2.5 billion fundraising for its Asia Credit Opportunities Fund II, demonstrating market resilience and ongoing demand.
- Market Dynamics: TPG successfully closed over $6 billion for its third flagship Credit Solutions fund in December, significantly exceeding its $4.5 billion target, indicating strong institutional investor demand for private credit despite potential market risks.
- Regional Differences: Compared to the U.S. and European markets, Asia's private credit landscape remains in its early stages, with Granite Asia executives noting that borrowers in the region are more conservative, exhibiting lower leverage and stricter covenants, which reflects stronger financial stability.
- Risk Warnings: While fundraising in private credit remains robust, Goldman Sachs warns that around 15% of borrowers are unable to fully service interest payments, indicating that financial pressures are intensifying in a high-rate environment, which could impact market stability going forward.
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Analyst Views on KKR
Wall Street analysts forecast KKR stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for KKR is 159.67 USD with a low forecast of 145.00 USD and a high forecast of 176.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
9 Analyst Rating
9 Buy
0 Hold
0 Sell
Strong Buy
Current: 116.770
Low
145.00
Averages
159.67
High
176.00
Current: 116.770
Low
145.00
Averages
159.67
High
176.00
About KKR
KKR & Co. Inc. is a global investment firm that offers alternative asset management as well as capital markets and insurance solutions. The Company’s segments include Asset Management, Insurance and Strategic Holdings. Asset Management segment offers a range of investment management services to investment funds, vehicles and accounts and provides capital markets services to portfolio companies and third parties. Asset Management segment includes five business lines: Private Equity, Real Assets, Credit and Liquid Strategies, Capital Markets and Principal Activities. Insurance segment is operated by Global Atlantic, which is a United States retirement and life insurance company that provides a suite of protection, legacy and savings products and reinsurance solutions to clients across individual and institutional markets. Global Atlantic offers individuals fixed-rate annuities and others. Strategic Holdings segment represents its participation in its core private equity strategy.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
KKR in Talks for Stake in Global Sport Group
- Investment Negotiations: KKR is in detailed discussions for a stake in London-based Global Sport Group, with a deal expected to be around €2.75 billion, which would significantly enhance KKR's influence in the sports investment sector.
- Diverse Equity Structure: Global Sport Group, backed by CVC Capital Partners, holds stakes in Six Nations Rugby, women's professional tennis, and top-tier men's football leagues in France and Spain, and KKR's involvement would further diversify its investment portfolio.
- Competitor Participation: In addition to KKR, Ares Management is also considering participation in this deal, indicating strong market interest in sports investments, which could intensify competition and impact deal terms.
- Optimistic Market Outlook: With the continuous growth of the sports industry, KKR's investment not only aids in increasing its asset management scale but may also yield long-term revenue growth, reflecting its success in a diversified investment strategy.
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