Blue Owl Capital (NYSE:OWL) shares rose more than 2% on Wednesday after JPMorgan analysts increased their price target on the company to $19.00 from $18.50 while maintaining a Neutral rating.
The analysts highlighted Blue Owl as a prominent alternative investment manager, excelling in three primary business lines: Owl Rock (direct lending), Dyal (general partner solutions), and Oak Street (triple net lease real estate). They noted that Blue Owl has significant potential for organic growth in assets under management (AUM) and fee-paying assets under management (FPAUM) in the medium term. However, the firm’s performance is closely linked to the broader success of alternative investment management sectors.
While Blue Owl’s investment products and medium-term outlook are robust, its current trading in the upper range of peer valuation multiples and the ongoing macroeconomic and credit market uncertainties present a range of potential outcomes.
The analysts view Blue Owl’s recent ventures positively, particularly its entry into the insurance sector through the acquisition of KAM and investment in Kuvare, which are expected to boost AUM and management fee growth. Additionally, the recent acquisition of Atalaya is seen as a strategic move to establish a presence in the rapidly growing alternative credit market.