Why Apollo Global Is Soaring This Week

Asset manager Apollo Global Management (NYSE: APO) is up 7% in the last week due to quarterly results it reported Tuesday that exceeded Wall Street's estimates.

Fee-related earnings -- an important measure of an asset management firm's core profitability -- soared 23% in the quarter, to $652 million. That was about 4% higher than Wall Street's forecast of $626.5 million.

And adjusted net income of $1.35 billion, or $2.17 a share, was 14% higher than the $1.90 consensus estimate.

In addition, capital inflows of $82 billion in the quarter and $219 billion over the last 12 months (a 24% year-over-year increase) boosted the firm's total assets under management -- a critical metric for asset managers -- to $908 billion, closing in on the trillion-dollar level. Part of that -- about $21 billion -- came from the company's third-quarter acquisition of Bridge Investment Group.

Source: Getty Images.

Strong insurance results

Apollo's Athene insurance unit performed particularly well in the quarter. Its $871 million in spread-related earnings -- basically earnings on investments minus payments it must make to policyholders -- was the highest level in two years. Apollo merged with Athene in 2021, and the insurance premiums it generates have allowed Apollo to make significant new loans, about $75 billion in new loans during the quarter.

While the stock is down about 19% this year, the strong quarterly results suggest Apollo is making positive strides.

Matthew Benjamin has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.