The real spark behind the latest move in TPG (TPG) stock is its $6.2 billion AG Credit Solutions Fund III closing, which landed about 40% above target and drew in several heavyweight public pensions.
See our latest analysis for TPG.
That successful $6.2 billion raise has clearly fed into sentiment, with a roughly 18.6% 1 month share price return helping push TPG to $67.57. Its 3 year total shareholder return above 140% shows that this momentum has been building for a while, not just this quarter.
If this kind of fundraising win has you thinking about what else is working in markets, now is a good time to explore fast growing stocks with high insider ownership for other fast moving ideas.
Yet with TPG now trading slightly above the average analyst price target, the real question is whether investors are underestimating its long term earnings power or whether the market is already pricing in years of growth.
With TPG closing at $67.57 against a most popular narrative fair value of $66.00, the story rests on aggressive profitability gains despite shrinking revenues.
Thematic investment focus in high-growth areas (sustainability, digital infrastructure, healthcare, AI) is enabling TPG to capitalize on long-term, secular shifts toward these sectors, which is supporting investment returns as well as growth in carried interest and incentive income, and positively impacting earnings.
Read the complete narrative.
Curious how falling revenues still back a richer valuation? This narrative leans on surging margins and future earnings power that look more like a growth stock than a traditional asset manager. Want to see which bold assumptions turn today’s price into “about right” rather than “too hot”?
Result: Fair Value of $66 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, persistent fundraising headwinds and tougher exits in volatile markets could quickly pressure fee growth, carried interest, and those optimistic margin assumptions.
Find out about the key risks to this TPG narrative.
While the narrative fair value pegs TPG as 2.4% overvalued, its 2.4x price to sales ratio still looks cheap versus the US Capital Markets industry at 4.1x and peers at 4.3x, yet expensive against its own 1.9x fair ratio. Is this a margin story or a valuation trap?
See what the numbers say about this price — find out in our valuation breakdown.
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