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TPG (TPG)
NASDAQ:TPG
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TPG
(NASDAQ:TPG)
Rating:63Neutral
Price Target:―
Positive Factors
Acquisition
The Peppertree acquisition is viewed favorably, offering immediate accretion to FRE and EPS, and positive bias on FRE margin.
Earnings
Post 1Q results, the 2Q25e EPS is raised by 2c to $0.41, indicating a 3.3% increase.
Valuation
TPG's valuation is attractively positioned compared to peers, with expected progress on new initiatives serving as a potential catalyst for re-rating.
Negative Factors
Management Fee Estimates
Management fee estimates for AG credit appear aggressive, posing risk of negative estimate revisions.
Market Environment
The higher-than-average tilt to private equity is a concern in the currently volatile environment.
Market Performance
TPG shares underperformed on 1Q earnings day compared to the S&P 500 and peer average.
TPG (TPG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$19.98B
Dividend Yield3.06%
Average Volume (3M)2.18M
Price to Earnings (P/E)―
Beta (1Y)1.56
Revenue Growth46.69%
EPS Growth-98.56%
CountryUS
Employees1,900
SectorFinancial
Sector Strength82
IndustryAsset Management
Share Statistics
EPS (TTM)0.48
Shares Outstanding137,990,950
10 Day Avg. Volume1,960,104
30 Day Avg. Volume2,178,255
Financial Highlights & Ratios
PEG Ratio0.39
Price to Book (P/B)4.33
Price to Sales (P/S)0.00
P/FCF Ratio1.61
Enterprise Value/Market Cap0.08
Enterprise Value/Revenue0.13
Enterprise Value/Gross Profit0.81
Enterprise Value/Ebitda2.77
Forecast
1Y Price Target
$53.50Price Target Upside-1.05% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering10
TPG Business Overview & Revenue Model
Company DescriptionTPG is a leading global alternative asset management firm with a focus on private equity, growth equity, real estate, credit, and public equity. The company operates across multiple sectors, including healthcare, technology, consumer products, and financial services, offering a range of investment strategies to its clients. TPG is known for its active management approach and its ability to create value through strategic investments and operational improvements.
How the Company Makes MoneyTPG makes money primarily through managing private investment funds and earning fees from investors. The company's revenue streams include management fees, which are a percentage of the total assets under management, and performance fees, which are earned when the investment returns exceed a predetermined benchmark. TPG also generates income from strategic partnerships and co-investments with institutional investors, enhancing its ability to deploy capital effectively across diverse sectors. Additionally, the firm earns returns from its direct investments and successful exits, including the sale of portfolio companies or assets.
TPG Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 18.01%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Positive
The earnings call highlighted TPG's strong financial performance, strategic acquisitions, and robust fundraising efforts, despite challenges posed by market volatility and economic uncertainty. The firm continues to expand its product offerings and strategic partnerships, positioning itself well for future growth.Q1-2025 Updates
Positive Updates
Strong First Quarter Financial Performance
TPG reported GAAP net income attributable to TPG Inc. of $25 million and after-tax distributable earnings of $187 million or $0.48 per share of Class A common stock. Fee-related earnings were at $182 million with a margin of 38%.
Significant Acquisition of Peppertree Capital Management
TPG announced the acquisition of Peppertree Capital Management for approximately $660 million. This acquisition is expected to be immediately accretive to fee-related earnings and after-tax distributable earnings per share upon closing. Peppertree has an outstanding investment track record with a gross realized return of 23% and a gross realized multiple of 2.4x invested capital.
Robust Fundraising and Strategic Partnerships
TPG raised nearly $6 billion in the first quarter across various platforms. The firm established a strategic partnership representing over $4 billion of potential new capital, spanning private equity, credit, real estate, and infrastructure.
Launch of New Products and Strategies
TPG launched TPOP, a new perpetually offered private equity vehicle, with significant interest and upcoming activations. The firm also launched TPG Sports in partnership with Rory McIlroy and Symphony Ventures.
Negative Updates
Market Volatility and Economic Uncertainty
TPG highlighted significant market volatility due to factors such as tariffs and policy uncertainty, resulting in unusual market correlations and renewed fears of inflation and concerns over slowing economic growth.
Elongated Fundraising Timelines
The current economic environment has led to elongated fundraising timelines, particularly for climate-related strategies due to policy uncertainty in the United States.
Lower Credit Fundraising in First Quarter
Credit fundraising was lighter in the first quarter, although TPG noted an acceleration in commitments to its credit strategies subsequently.
Company Guidance
In the first quarter of 2025, TPG reported a GAAP net income attributable to TPG Inc. of $25 million and after-tax distributable earnings of $187 million, equating to $0.48 per share of Class A common stock. The firm declared a dividend of $0.41 per share of Class A common stock, payable on June 2, 2025, to holders of record on May 19, 2025. TPG's fee-related revenues were $476 million, with management fees contributing $413 million, and transaction fees accounting for $54 million. The firm maintained a fee-related earnings margin of 38%, consistent with previous guidance. Total assets under management reached $251 billion, marking a 12% increase year-over-year, with $143 billion in fee-earning AUM. TPG is optimistic about its capital formation efforts, expecting to raise significantly more capital in 2025 than in the previous year, despite the volatile environment. The firm has over $57 billion of dry powder across its platforms, positioning it well to capitalize on investment opportunities amid market dislocation.TPG Financial Statement Overview
Summary
TPG exhibits strong operational efficiency and a robust balance sheet with no debt reliance. However, challenges in profitability and cash flow fluctuations impact its financial performance.Income Statement
TPG's revenue growth has been inconsistent, with a notable increase in 2024 compared to 2023. However, the net profit margin is negative due to a net loss in 2024, indicating challenges in profitability. The EBIT margin improved significantly in 2024, reflecting better operational efficiency despite previous losses.60
Neutral
Balance Sheet
TPG has a strong equity base with a debt-to-equity ratio of 0, indicating no reliance on debt financing in 2024. The equity ratio is moderate, reflecting a stable financial position. However, fluctuations in stockholders' equity over the years suggest potential volatility.75
Positive
Cash Flow
The free cash flow was positive in 2024, showcasing good cash generation ability. The operating cash flow is strong compared to net income, which is a positive indicator. However, the decline in free cash flow growth in 2024 compared to previous periods points to some challenges in maintaining cash flow momentum.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.82B | 2.62B | 1.82B | 1.90B | 5.56B | 2.25B |
| Gross Profit | 1.89B | 2.54B | 23.28M | 381.47M | 4.62B | 1.72B |
| EBITDA | 245.52M | 110.56M | 0.00 | 179.51M | 0.00 | 1.11B |
| Net Income | 33.36M | 23.48M | 80.09M | 92.43M | 2.18B | 731.67M |
Balance Sheet | ||||||
| Total Assets | 11.31B | 10.54B | 9.37B | 7.94B | 8.96B | 7.00B |
| Cash, Cash Equivalents and Short-Term Investments | 821.97M | 808.02M | 678.37M | 1.11B | 972.73M | 1.26B |
| Total Debt | 2.10B | 1.58B | 1.26B | 444.57M | 621.45M | 490.63M |
| Total Liabilities | 7.82B | 6.94B | 6.01B | 4.86B | 1.66B | 1.48B |
| Stockholders Equity | 823.08M | 784.10M | 579.16M | 509.67M | 1.61B | 2.46B |
Cash Flow | ||||||
| Free Cash Flow | 268.81M | 504.01M | 703.79M | 1.37B | 1.47B | -20.16M |
| Operating Cash Flow | 376.12M | 532.15M | 720.52M | 1.38B | 1.47B | 95.39M |
| Investing Cash Flow | 198.29M | -44.47M | -373.56M | -3.01M | -37.74M | -108.10M |
| Financing Cash Flow | -573.79M | -344.86M | -789.23M | -1.24B | -1.32B | 250.33M |
TPG Technical Analysis
Positive
54.07
Price Trends
49.40
Positive
49.58
Positive
56.60
Negative
Market Momentum
1.22
Negative
66.77
Neutral
84.04
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TPG, the sentiment is Positive. The current price of 54.07 is above the 20-day moving average (MA) of 51.28, above the 50-day MA of 49.40, and below the 200-day MA of 56.60, indicating a neutral trend. The MACD of 1.22 indicates Negative momentum. The RSI at 66.77 is Neutral, neither overbought nor oversold. The STOCH value of 84.04 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TPG.
TPG Risk Analysis
TPG disclosed 74 risk factors in its most recent earnings report. TPG 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 1 New Risks
1.
Artificial intelligence and other machine learning techniques could increase competitive, operational, legal and regulatory risks to our businesses in ways that we cannot predict. Q4, 2024
TPG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $15.56B | 10.96 | 10.29% | 8.63% | 14.14% | -31.30% | |
71 Outperform | $25.62B | 12.29 | 17.54% | 2.27% | 21.00% | 137.62% | |
70 Outperform | $20.12B | 18.82 | 20.38% | 2.57% | 81.86% | ― | |
67 Neutral | $19.67B | 28.49 | 5.84% | 2.71% | -23.47% | -67.03% | |
67 Neutral | ¥718.51B | 10.84 | 7.44% | 3.36% | 7.82% | 15.26% | |
63 Neutral | $19.98B | ― | 0.24% | 3.06% | 46.69% | -98.56% | |
63 Neutral | $6.64B | 103.13 | -71.28% | 4.52% | 118.79% | -285.61% |
* Financial Sector Average
Performance Comparison
TPG
TPG
54.07
14.75
37.51%
CG
Carlyle Group
55.70
16.39
41.69%
NTRS
Northern
131.70
51.26
63.72%
ARCC
Ares Capital
22.41
3.08
15.93%
STEP
StepStone Group
57.01
13.56
31.21%
CRBG
Corebridge Financial, Inc.
35.78
7.64
27.15%
TPG Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
TPG Strengthens Board with New Independent Director
Positive
Jan 15, 2025
On January 15, 2025, TPG Inc. appointed Kathy Elsesser as an independent director as part of its strategic transition to a majority independent board. Elsesser, who brings over three decades of experience from Goldman Sachs, will serve on the Audit and Compensation Committees, enhancing TPG’s corporate governance and positioning as a leader in the alternative asset management industry.
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.