StepStone Group (NASDAQ:STEP) Posts Earnings Results, Beats Estimates By $0.11 EPS

StepStone Group (NASDAQ:STEP) posted its quarterly earnings results on Thursday. The company reported $0.66 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.55 by $0.11, FiscalAI reports. The business had revenue of $362.71 million for the quarter, compared to the consensus estimate of $324.84 million. StepStone Group had a positive return on equity of 43.38% and a negative net margin of 30.53%.

Here are the key takeaways from StepStone Group’s conference call:

• StepStone reported record fee-related earnings of $126 million, up 61% year over year, with a 42% core FRE margin and adjusted earnings of $0.66 per share. Management cautioned that 42% is not a near-term run rate as recently hired staff and seasonal conference costs increase expenses; the company also reported a $71 million GAAP net loss, driven by a required fair-value adjustment related to the private wealth profits interest.
• Fundraising reached a company record, with $43 billion of gross AUM additions over the past 12 months. Fee-earning AUM rose to $158 billion and undeployed fee-earning capital reached a record $42 billion, providing a substantial base for future fee growth.
• Private wealth funds attracted $1.7 billion in subscriptions during the quarter, and the platform exceeded $23 billion in assets; redemptions were just 2%. Management cited continued growth in distribution partners and cross-selling, while viewing retirement-plan access as a longer-term opportunity.
• Management said higher rates and sluggish exits are weighing on private-market distributions, but expects secondaries and other liquidity solutions to remain important. More than $1 billion of net accrued carry is mostly tied to older programs, though the timing of realizations remains difficult to predict.
• StepStone plans to retain cash that would otherwise fund this fiscal year’s supplemental dividend as it prepares to exercise its option to buy in private wealth profits interests. The regular quarterly dividend of $0.33 per share is unchanged.

StepStone Group Stock Down 7.7%

Shares of NASDAQ:STEP traded down $3.59 on Thursday, reaching $42.81. The company had a trading volume of 1,494,779 shares, compared to its average volume of 806,360. StepStone Group has a 52-week low of $38.85 and a 52-week high of $77.79. The firm’s 50 day simple moving average is $45.68 and its 200-day simple moving average is $49.03. The firm has a market capitalization of $5.11 billion, a PE ratio of -5.55 and a beta of 1.28. The company has a current ratio of 0.19, a quick ratio of 0.19 and a debt-to-equity ratio of 1.22.

Wall Street Analyst Weigh In

A number of research firms recently weighed in on STEP. Morgan Stanley set a $61.00 price objective on shares of StepStone Group in a research note on Friday, October 16th. Wells Fargo & Company assumed coverage on shares of StepStone Group in a report on Friday, October 2nd. They set an “overweight” rating and a $55.00 target price on the stock. Barclays raised their target price on shares of StepStone Group from $60.00 to $62.00 and gave the company an “overweight” rating in a research report on Friday, August 7th. BMO Capital Markets reduced their price target on shares of StepStone Group from $58.00 to $48.00 and set an “outperform” rating for the company in a report on Tuesday, October 27th. Finally, Weiss Ratings restated a “sell (d-)” rating on shares of StepStone Group in a report on Friday, October 16th. Eight analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and an average price target of $66.11.

Key Headlines Impacting StepStone Group

Here are the key news stories impacting StepStone Group this week:

• Positive Sentiment: Quarterly earnings were $0.66 per share, above estimates of roughly $0.55–$0.57 and up from $0.54 a year earlier. Revenue of $362.71 million also exceeded the $324.84 million consensus estimate. StepStone Group Q2 Earnings and Revenues Top Estimates
• Neutral Sentiment: Additional coverage says adjusted earnings and revenue rose, and highlights the need to assess operating metrics beyond the headline results; the excerpts provided do not specify those metrics. StepStone Group Q2 Earnings: Key Metrics Versus Estimates
• Negative Sentiment: Despite the earnings and revenue beats, STEP came under selling pressure. The reports supplied do not point to a clear reason for the decline, so investors may be weighing details not captured in the headline figures. StepStone Group Reports Second Quarter Fiscal Year 2027 Results

StepStone Group Company Profile

StepStone Group, Inc is a global investment firm focused on private markets. The company provides investment solutions and advisory services to institutional investors, family offices, and other clients seeking exposure to privately held and alternative assets.

Its activities include investments in private equity, venture capital, private debt, infrastructure, and real estate. StepStone builds customized portfolios through primary investments in funds, secondary-market transactions, and direct investments in companies and assets.