$KKR; Investing in the Investor

This is a pitch on KKR that we made finalist in the Cleveland Research Stock Pitch Competition with. To sum it all up, we believe KKR is best positioned in the alternative asset management industry to take advantage of opportunities in infrastructure and APAC. We also think that the street is underestimating their Strategic Holdings arm due to not understanding managements long-term vision.

Our group saw room for improvement in a couple of different areas of our pitch once the competition was over. One area was we didn’t quantify our qualitative thesis points enough. Consensus wasn’t brought up nearly enough in our pitch and since our thesis points were mainly qualitative, it left use with many holes in our pitch. Another area we think we could’ve improved in was not telling a story. Even though we felt our pitch was adequate, we then watched some of the other schools pitch and they told really detailed stories around a couple of different stocks, including $VRT ( ▼ 0.94% ) and $LW ( ▲ 1.21% ). We probably could’ve presented more information on sell-side sentiment to get more of a feel on how they feel about the stock and how that played into the investment setup (sentiment + positioning + catalyst).

One thing I thought we did really well was channel research, we got the chance to speak to some really experienced people in private markets from LP’s to researchers. This helped us get an inside view on a somewhat esoteric industry.

The macro end of things really effected our pitch. In our first submission we had a price target of $145 and a current price of $114, this was before liberation day. Monday April 7th was the date of our second submission, this is after Liberation day and KKR had gotten slaughtered down to $92 and this left us with a price target of $119.25 - $124.25. Our last submission was April 10th, KKR’s stock price had soared to $110 after the insane market rally, this left us with a price target of $137.28 - $142.28.

Overall great learning experience.