In May, shares of KKR (NYSE: KKR) increased by 10.5%, driven by the company’s first-quarter results and several strategic partnerships.
According to S&P Global Market Intelligence, KKR reported notable financial performance and expanded its investment footprint through various collaborations.
KKR’s first-quarter earnings report reveals significant growth
KKR reported strong first-quarter results in early May, highlighting over 20% growth in fee-related earnings, total operating earnings, and adjusted net income.
The private equity firm also increased its assets under management (AUM) by 13%, reaching $578 million, with $31 billion of new capital raised during the quarter.
Strategic partnerships announced in May
Throughout May, KKR announced several strategic partnerships aimed at enhancing its investment capabilities.
One notable joint venture was with Healthcare Realty (NYSE: HR), where Healthcare Realty contributed 12 existing properties valued at $383 million.
In return, Healthcare Realty received $300 million and retained a 20% stake in the joint venture. KKR may potentially invest up to $600 million more to support the partnership’s growth.
Another significant partnership involved Hannon Armstrong Sustainable Infrastructure Capital (NYSE: HASI), with the formation of CarbonCount Holdings.
Each firm committed $1 billion to invest in climate-positive projects, combining Hannon Armstrong’s expertise in sustainable infrastructure with KKR’s capital resources.
Additionally, KKR partnered with Capital Group to develop public-private investment solutions.
This collaboration aims to provide high-net-worth individuals and accredited investors with more access to alternative investments, spanning various asset classes and geographies.
Valuation analysis after recent stock rally
Despite an 80% increase in KKR’s stock over the past year, the shares still trade at a forward price-to-earnings ratio (P/E) of less than 21, which is slightly below the S&P 500’s forward P/E of over 21.5.
This valuation is noteworthy considering KKR’s current growth rate and the rising interest in alternative investments among retail investors, who are expected to invest significantly in this sector in the coming years.
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