KKR & Co. Inc.

This is our first report on a global investment behemoth, KKR & Co. Inc. The company delivered strong set of quarterly results surpassing Wall Street expectations on all fronts. Despite a turbulent business environment, the performance of KKR’s investments on its balance sheet was flat for the quarter. The core PE portfolio increased in value by 7%. Management fees were $706 million in Q4. Its Real Assets business grew the most, with management fees increasing by more than 50%. The Capital Markets division generated $144 million in revenue in the quarter, with net transaction and monitoring fees totaling $195 million. The company generated $339 million in realized carried interest from the monetizations of Minnesota Rubber and Plastics, as well as a number of public positions, and $339 million in realized incentive fees from the crystallization of performance payments at Marshall Wace. Realized investment income was $223 million in the quarter. Their asset management operational earnings were $946 million. Global Atlantic also had another successful quarter, with operating earnings of $165 million. We initiate coverage on the stock of KKR & Co., Inc. with a ‘Hold’ rating.