KKR & Co. Inc. KKR is slated to report fourth-quarter 2024 results on Feb. 4, before the opening bell. Its earnings and revenues in the quarter are expected to have increased on a year-over-year basis.
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In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate. Results primarily reflected impressive growth in AUM and record transaction fees for the capital markets business. However, increased expenses acted as headwinds.
The company boasts an impressive earnings surprise history. Its earnings surpassed the consensus estimate in the trailing four quarters, the average beat being 7.60%.
KKR & Co. Inc. Price and EPS Surprise
KKR & Co. Inc. price-eps-surprise | KKR & Co. Inc. Quote
KKR’s Q4 Earnings & Sales Estimates
The Zacks Consensus Estimate for KKR’s fourth-quarter earnings is pegged at $1.27 per share, which has decreased 1.6% over the past seven days. The figure indicates an increase of 27% from the year-ago quarter’s reported number.
The consensus estimate for sales is pegged at $1.23 billion, indicating 14.25% year-over-year growth.
Key Factors & Estimates for KKR in Q4
KKR has been witnessing increases in fee-earning AUM and total AUM on the back of its diversified product and revenue mix, superior position in the alternative investments space and net inflows. Given the high market volatility and increased client activity in the fourth quarter, KKR is expected to have recorded a rise in AUM balance as inflows grew.
The Zacks Consensus Estimate for fourth-quarter 2024 AUM is pegged at $642.9 billion, suggesting a rise of 16.3% from the prior-year quarter’s reported number. Likewise, the consensus estimate for fee-paying AUM in the fourth quarter of 2024 is pegged at $520.4 billion, which indicates a year-over-year increase of 16.6%.
The Zacks Consensus Estimate for management fees (segment revenues) for the to-be-reported quarter is pegged at $918.6 million, which indicates 17.1% growth from the prior-year quarter’s reported level.
The consensus estimate for fee-related Transaction and Monitoring revenues (segment revenues) in the fourth quarter of 2024 is pegged at $258.9 million, suggesting a year-over-year decline of 2%.
The consensus estimate for fee-related Performance revenues (segment revenues) of $34.34 million implies year-over-year growth of 43.4%.
Talking about expenses, KKR is likely to have experienced elevated expenses in the to-be-reported quarter due to higher employee compensation and benefits, along with increased investment in technological development to align with changing customer needs.
What Our Model Predicts for KKR
Our quantitative model does not conclusively predict an earnings beat for KKR this time. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher.
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
KKR’s Earnings ESP: The Earnings ESP for KKR is -1.05%.
KKR’s Zacks Rank: The company currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Performance of KKR’s Peers
Invesco’s IVZ fourth-quarter 2024 adjusted earnings of 52 cents per share surpassed the Zacks Consensus Estimate of 49 cents. Moreover, the bottom line increased 10.6% from the prior-year quarter.
The results primarily gained from a decline in adjusted expenses and higher adjusted net revenues. An increase in AUM balance on decent inflows was a positive for IVZ.
BlackRock’s BLK fourth-quarter 2024 adjusted earnings of $11.93 per share surpassed the Zacks Consensus Estimate of $11.44. The figure reflected a rise of 23.5% from the year-ago quarter.
BLK’s results benefited from a rise in revenues. AUM witnessed robust growth and touched the $11.55 trillion mark, driven by net inflows, partially offset by market depreciation and negative forex impact. However, higher expenses and lower non-operating income acted as headwinds.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
