Kotowski estimates that distributable earnings for APO will total $3.01 a share in 2013, declining to $2.82 in 2014. Based on his estimates, APO's stock trades for 7.0 times enterprise value.
The analyst on Wednesday lowered his price target for APO to $32.50 from $34, but the new price target still represents potential upside of 44% for the shares.
For both companies, investors are concerned that there may be a slowdown in distributable carry and gains for investments made at huge discounts before 2010, "but since 2010 these two companies have deployed more than $27B that is likely to generate future carry," Kotowski wrote.
-- Written by Philip van Doorn in Jupiter, Fla.>Contact by Email. Follow @PhilipvanDoorn
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV