On Monday, TD Cowen adjusted its outlook on The Carlyle Group LP (NASDAQ:) shares, increasing the investment firm’s price target to $51 from $46, while maintaining a Market Perform rating. The revision follows The Carlyle Group’s recent investor webcast, which prompted TD Cowen to update its financial model for the company.

The firm cited several reasons for the price target adjustment, including expectations for faster organic growth and higher transaction activity. Additionally, the analyst anticipates a strong, albeit slightly slower, ramp-up in fee-related earnings (FRE) margins. These factors contributed to the revised 2024-2025 Distributable Earnings (DE) estimates.

TD Cowen’s new 12-month Sum of the Parts (SOTP) price target reflects an improved outlook for Distributable Earnings and a moderately higher target multiple for Carlyle’s fee-related earnings, net of share-based compensation (SBC). Despite the positive adjustments to the financial forecasts, TD Cowen is opting to maintain its Market Perform rating on the stock, indicating a neutral stance on its investment potential.

The analyst’s comments suggest that while the updated figures present a more favorable view of The Carlyle Group’s financial prospects, the firm is still seeking a more advantageous point of entry before changing its rating. The market performance and valuation of The Carlyle Group will continue to be monitored by investors as they assess the impact of the updated price target and rating.

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