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Apollo Global Management: Benefiting From Alternatives

Jun. 08, 2020 9:52 AM ETApollo Global Management, Inc. (APO)2 Comments


  • Apollo Global Management is one of the leading alternative investment managers across the globe.
  • Company’s asset under management of $331 billion has grown two-fold over the past five years with high FRE margins.
  • Apollo used the fear-driven period during the COVID-19 pandemic to its advantage.
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Fear-driven periods in the past have been used as buying opportunities for savvy investors. - John Paulson

Apollo Global Management (NYSE:APO), has turned out to be the big winner during the economic slowdown caused by COVID-19. The company has a solid track record of handling crises like these. It has been very proactively doing deals and raising capital. Also, the company has been meeting with its portfolio companies and providing liquidity which at this tough time is very critical. With the stock trading at $51.30 as on 04-06-2020, it’s a definite buy.

Company Overview

Founded in 1990, Apollo is a leading global alternative investment manager. The company is led by Managing Partners Leon Black, Joshua Harris and Marc Rowan. As of March 31, 2020, the company has total Asset under Management (AUM) of $315 billion, including approximately $216 billion in credit, $77 billion in private equity and $39 billion in real assets.

Apollo has built its reputation on navigating all market environments, but particularly challenging ones, very successfully on behalf of its investors.


Credit is an integral part of the company and has contributed to its growth and success. The company’s credit segment has a total AUM of $210 billion. Total AUM decreased 3% quarter-over-quarter to $210 billion, primarily driven by market activity, partially offset by inflows

As on March 31, 2020

Private Equity

Private equity has been the cornerstone of Apollo’s business since the start of the business operations. The private equity funds of the company have owned more than 150 companies since its inception across various sectors. The personal equity business has approximately $68 billion in assets under management (AUM) as of March 31, 2020. Total AUM decreased 12% quarter-over-quarter to $68 billion, primarily driven by market activity and realizations

Real Assets

Apollo’s Real Assets business is

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This article was written by

Michael A. Gayed, CFA profile picture
Michael A. Gayed is portfolio manager, and author of five award-winning research papers on market anomalies and investing. He has a BS with a double major in Finance & Management from NYU Stern School of Business, and is a CFA Charterholder. Michael runs the investing group The Lead-Lag Report, focused on helping investors outperform in all market conditions. It offers a tactical, data-driven approach to investing, to achieve long-term success even in the face of uncertainty. With increasing market volatility, it's essential to understand risk-on/risk-off signals, seize high-yield opportunities, and leverage award-winning research to maximize returns. Learn More.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (2)

This company is pretty large and it had a negative net income? Does that concern anyone?
BM Cashflow Detective profile picture
"The risk factors can hurt the company’s near-term earnings, but I still believe the company is a potential buy. It has an excellent track record and has outperformed the market for the past ten years."
"Sometimes, you might not realize your biggest portfolio risks until it’s too late."

As a shareholder of $ APO, I'm of course happy about the very positive company development. Hopefully another equally positive development is likely.
But every "buy" rating should always include an appropriate "stock rating".

The ratio of "company value to sales" places the company among the world's most expensive companies. How is the buy rating in relation to a stock overvaluation? There is no margin of safety. Too optimistic attitudes often involve potentially great risks in themselves. In other words. Success is already the seed of failure. How is the above sentence to be seen in this context?
From my cautious point of view, APO is a hold.
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