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StepStone Group (STEP)
NASDAQ:STEP
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StepStone Group
(NASDAQ:STEP)
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Rating:51Neutral
Price Target:
$66.00
▲(1.18% Upside)
StepStone Group's overall stock score reflects significant financial challenges, with negative profitability and high leverage being major concerns. While technical analysis shows positive momentum, the valuation metrics are unfavorable. The lack of earnings call and corporate events data limits further insights.
Positive Factors
Revenue Growth
Strong revenue growth reflects the company's ability to expand its market presence and attract more clients, which is crucial for long-term success in the asset management industry.
Industry Collaboration
The collaboration with Kroll to launch private credit benchmarks positions StepStone as a leader in providing innovative solutions, enhancing its competitive edge in the private markets sector.
Cash Flow Resilience
Despite profitability challenges, strong cash flow management indicates StepStone's ability to sustain operations and invest in growth opportunities, supporting long-term stability.
Negative Factors
High Leverage
High leverage can increase financial risk and limit financial flexibility, posing challenges for StepStone in managing its capital structure and funding future growth.
Negative Profitability
Negative profitability indicates operational challenges that could hinder StepStone's ability to generate sustainable earnings, impacting its long-term financial health.
Decline in Free Cash Flow
A decline in free cash flow growth suggests potential difficulties in funding operations and investments, which could affect StepStone's ability to capitalize on growth opportunities.
StepStone Group (STEP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.90B
Dividend Yield2.15%
Average Volume (3M)697.85K
Price to Earnings (P/E)103.1
Beta (1Y)1.35
Revenue Growth88.68%
EPS Growth-494.20%
CountryUS
Employees1,090
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)0.40
Shares Outstanding78,552,910
10 Day Avg. Volume875,118
30 Day Avg. Volume697,849
Financial Highlights & Ratios
PEG Ratio0.06
Price to Book (P/B)20.72
Price to Sales (P/S)3.16
P/FCF Ratio62.11
Enterprise Value/Market Cap0.76
Enterprise Value/Revenue4.43
Enterprise Value/Gross Profit34.01
Enterprise Value/Ebitda-21.67
Forecast
1Y Price Target
$73.00Price Target Upside11.91% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
StepStone Group Business Overview & Revenue Model
Company DescriptionStepStone Group Inc. is a global private markets investment firm, specializing in providing customized investment solutions and advisory and data services. Operating across sectors such as private equity, private debt, real estate, and infrastructure, StepStone offers its clients a range of investment strategies including fund investments, secondaries, and co-investments. The firm leverages its extensive expertise and global reach to deliver tailored solutions that meet the unique needs of institutional investors.
How the Company Makes MoneyStepStone Group makes money primarily through management fees and performance fees. The company earns management fees by providing advisory services and managing investment portfolios on behalf of its clients, which include public pension funds, insurance companies, and other institutional investors. Performance fees are earned based on the investment performance of the funds and portfolios managed by StepStone, usually taking the form of a percentage of the profits generated. Additionally, the company may generate revenue from data services and strategic partnerships that enhance its investment capabilities and expand its client base.
StepStone Group Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant growth in fee-related earnings, adjusted net income, and assets under management, bolstered by successful fundraising and expansion of the private wealth platform. Despite reporting a GAAP net loss and acknowledging market volatility, the positive performance metrics and strategic achievements suggest a strong overall position.Q4-2025 Updates
Positive Updates
Record Fee-Related Earnings and Margin
The company reported fee-related earnings of $94.1 million, up 85% from the prior year quarter, with an FRE margin of 44%, marking the highest levels ever for both quarterly and annual results.
Strong Adjusted Net Income Growth
Adjusted net income for the quarter was $80.6 million or $0.68 per share, up from $37.7 million or $0.33 per share in the fourth quarter of the previous year.
Record Dividend Distribution
StepStone declared a base quarterly dividend of $0.24 and a supplemental dividend of $0.40, with the full dividend payout for the fiscal year amounting to $1.36, up from last year's total of $0.99.
Significant Growth in Private Wealth AUM
The private wealth platform grew from $3.4 billion at the end of fiscal 2024 to over $8 billion by the end of fiscal 2025.
Successful Fundraising and Asset Growth
Total gross inflows were $9.9 billion for the quarter, with fee-earning AUM surpassing $121 billion, up $7.2 billion from the previous quarter.
Largest Real Estate Secondary Fund Raised
The real estate secondaries fund closed at $3.75 billion, the largest ever raised in the industry.
Negative Updates
GAAP Net Loss Reported
StepStone reported a GAAP net loss attributable to the company of $18.5 million or $0.24 per share for the quarter.
Volatility in Capital Markets
The company noted a shift in the capital markets environment in April, characterized by volatility and widening bid-ask spreads, creating uncertainty for future operations.
Company Guidance
During the fiscal fourth quarter of 2025, StepStone Group Inc. reported several key financial metrics. The company experienced a GAAP net loss of $18.5 million or $0.24 per share. However, their fee-related earnings surged to $94.1 million, reflecting an 85% increase from the previous year's quarter, with an FRE margin of 44%. The adjusted net income for the quarter was $80.6 million or $0.68 per share, a significant improvement from the $37.7 million or $0.33 per share recorded in the same period of the last fiscal year. The company declared a base quarterly dividend of $0.24 and a supplemental dividend of $0.40. For the full fiscal year, they raised over $31 billion in assets under management, with a 29% growth in fee-earning AUM, which contributed to their record earnings. StepStone also reported total gross inflows of $9.9 billion for the quarter, with $1.2 billion from evergreen subscriptions, marking their best private wealth quarter ever. The company's fee-earning assets under management increased to over $121 billion, up $7.2 billion from the previous quarter.StepStone Group Financial Statement Overview
Summary
StepStone Group's financial performance is challenged by high leverage and negative profitability margins, despite strong revenue growth. The balance sheet shows significant financial risk with a high debt-to-equity ratio, and cash flow management indicates resilience but is under pressure.Income Statement
StepStone Group's income statement shows a mixed performance. The company experienced a significant revenue growth rate of 15.31% in the TTM period, indicating strong top-line growth. However, profitability metrics are concerning, with negative net profit and EBIT margins, suggesting operational challenges. The gross profit margin has also declined compared to previous periods, reflecting increased cost pressures.45
Neutral
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio of 2.48 in the TTM period, indicating significant leverage and potential financial risk. Return on equity is negative, reflecting recent losses. The equity ratio has decreased, suggesting a weaker capital structure. These factors highlight potential financial instability and increased risk exposure.40
Negative
Cash Flow
Cash flow analysis shows a decline in free cash flow growth, with a negative growth rate of -7.37% in the TTM period. The operating cash flow to net income ratio is low, indicating limited cash generation relative to net income. However, the free cash flow to net income ratio remains relatively strong, suggesting some resilience in cash flow management despite profitability challenges.50
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.35B | 1.17B | 711.63M | -67.57M | 1.37B | 787.72M |
| Gross Profit | 176.45M | -89.47M | 339.09M | 171.60M | 562.83M | 384.55M |
| EBITDA | -276.93M | -205.23M | 249.86M | 11.60M | 538.42M | 334.30M |
| Net Income | -231.31M | -179.56M | 58.09M | -18.40M | 193.88M | 62.63M |
Balance Sheet | ||||||
| Total Assets | 4.78B | 4.59B | 3.79B | 3.50B | 4.19B | 1.32B |
| Cash, Cash Equivalents and Short-Term Investments | 244.13M | 289.30M | 181.59M | 128.56M | 116.39M | 179.89M |
| Total Debt | 382.08M | 382.79M | 268.56M | 219.57M | 133.84M | 0.00 |
| Total Liabilities | 3.08B | 2.81B | 1.92B | 1.84B | 2.36B | 661.08M |
| Stockholders Equity | 153.93M | 179.36M | 324.48M | 771.57M | 817.63M | 249.41M |
Cash Flow | ||||||
| Free Cash Flow | 55.42M | 59.83M | 141.91M | 145.56M | 212.18M | 148.04M |
| Operating Cash Flow | 61.04M | 64.93M | 161.52M | 151.18M | 214.28M | 149.30M |
| Investing Cash Flow | -42.06M | -43.48M | -47.35M | -30.81M | -210.24M | -11.17M |
| Financing Cash Flow | 38.16M | 87.48M | -57.98M | -108.02M | -70.44M | -45.31M |
StepStone Group Technical Analysis
Positive
65.23
Price Trends
61.04
Positive
58.63
Positive
57.17
Positive
Market Momentum
1.43
Negative
58.47
Neutral
83.48
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STEP, the sentiment is Positive. The current price of 65.23 is above the 20-day moving average (MA) of 62.59, above the 50-day MA of 61.04, and above the 200-day MA of 57.17, indicating a bullish trend. The MACD of 1.43 indicates Negative momentum. The RSI at 58.47 is Neutral, neither overbought nor oversold. The STOCH value of 83.48 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STEP.
StepStone Group Risk Analysis
StepStone Group disclosed 68 risk factors in its most recent earnings report. StepStone Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
StepStone Group Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | 6.92B | 16.78 | 8.80% | 3.56% | 17.59% | -8.81% | |
76 Outperform | 4.19B | 11.38 | ― | 8.93% | ― | 16.78% | |
74 Outperform | 9.89B | 24.09 | 5.32% | 3.74% | 6.79% | ― | |
74 Outperform | 6.74B | 18.20 | 15.29% | 0.02% | -5.87% | -21.51% | |
61 Neutral | 7.96B | 28.82 | 27.96% | 1.44% | 10.66% | 22.13% | |
51 Neutral | $7.90B | 103.13 | -88.82% | 2.15% | 88.68% | -494.20% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
Performance Comparison
STEP
StepStone Group
65.23
10.04
18.19%
AMG
Affiliated Managers
237.24
60.44
34.19%
AB
AllianceBernstein
37.84
6.06
19.07%
IVZ
Invesco
22.18
5.24
30.93%
HLNE
Hamilton Lane
142.78
-22.10
-13.40%
JHG
Janus Henderson Group
44.34
7.58
20.62%
StepStone Group Corporate Events
M&A TransactionsBusiness Operations and Strategy
StepStone Group Completes Significant Equity Acquisition
Positive
May 30, 2025
On May 30, 2025, StepStone Group Inc. and StepStone Group LP completed a significant transaction to acquire additional equity interests in their Asset Class Entities, including StepStone Group Real Estate LP, StepStone Group Real Assets LP, and StepStone Group Private Debt AG. This exchange increased their ownership to approximately 60% in SRE and SRA, and 61% in SPD, involving a consideration of $11 million in cash, shares of Class A Common Stock, and Class D Units. The transaction is expected to enhance StepStone’s market positioning by consolidating its control over these entities, potentially impacting its operational strategy and stakeholder interests.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.