Why This Apollo Global Management Analyst Is Now Bullish

Apollo Global Management’s APO chief economist recently expressed skepticism around AI (artificial intelligence) being a bubble.

The company is a leader in the alternative asset management space and seems well-positioned for growth in private credit, according to JPMorgan.

The Apollo Global Management Analyst: Kenneth Worthington upgraded the rating Apollo Global Management from Neutral to Overweight, while establishing a price target of $122.

The Apollo Global Management Thesis: The company is poised to capitalize on secular trends such as “the proliferation of private credit and an aging population needing reliable income for retirement,” Worthington said in the upgrade note.

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Apollo Global Management’s insurance strategy is different from its peers, which allowed it to leverage “better investment returns to offer customers better annuity prices/yields to drive industry-leading asset management and insurance sales/growth, but also funding this growth in a more capital-efficient manner,” the analyst wrote.

He added, however, the company has a “balance sheet heavy business.”

Apollo Global Management’s leadership is “particularly innovative and creative,” and the company has “a business model that gives investors more of what they want: cheaper fee-related earnings funded by a more creative third party capital structure,” Worthington stated.

APO Price Action: Shares of Apollo Global Management had risen by 0.99% to $111.92 at the time of publication Wednesday.

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