Industry Analysts Just Upgraded Their Apollo Global Management, Inc. (NYSE:APO) Revenue Forecasts By 14%

Apollo Global Management, Inc. (NYSE:APO) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that Apollo Global Management will make substantially more sales than they'd previously expected.

Following the upgrade, the consensus from nine analysts covering Apollo Global Management is for revenues of US$2.9b in 2022, implying a painful 50% decline in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$2.5b in 2022. It looks like there's been a clear increase in optimism around Apollo Global Management, given the nice increase in revenue forecasts.

See our latest analysis for Apollo Global Management

The consensus price target fell 5.7% to US$81.21, with the analysts clearly less optimistic about Apollo Global Management's valuation following this update. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Apollo Global Management, with the most bullish analyst valuing it at US$105 and the most bearish at US$64.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Apollo Global Management's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 50% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 22% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.2% annually for the foreseeable future. It's pretty clear that Apollo Global Management's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Apollo Global Management's future valuation. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Apollo Global Management.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 5 potential flags with Apollo Global Management, including dilutive stock issuance over the past year. You can learn more, and discover the 4 other flags we've identified, for free on our platform here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.