StepStone Group (NASDAQ:STEP) Announces Earnings Results

StepStone Group (NASDAQ:STEP) announced its quarterly earnings results on Thursday. The company reported $0.48 earnings per share for the quarter, missing analysts’ consensus estimates of $0.50 by ($0.02), FiscalAI reports. The company had revenue of $300.60 million during the quarter, compared to the consensus estimate of $309.32 million. StepStone Group had a negative net margin of 30.53% and a positive return on equity of 52.55%.

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

• Strong financial performance: Fee-related earnings rose 30% to $106 million, adjusted net income increased 22% to $60 million, and fee-earning AUM plus undeployed capital reached approximately $193 billion, up 19% organically year over year.
• Fundraising remained robust, with nearly $40 billion of gross AUM additions over the past year and $10 billion in the quarter. Private wealth subscriptions reached a record $2.8 billion, taking private wealth assets above $21 billion, while platform redemptions remained below 2%.
• Management expects the planned buy-in of the remaining Private Wealth profits interest to provide significant earnings-per-share accretion by capturing the full economics of a high-growth business, though the transaction will require a mix of equity, cash, and potentially additional debt financing.
• SPRING generated an exceptional 23% net return in the first half of the calendar year, driving strong inflows and anticipated incentive fees; however, management cautioned that such performance is not typical and that public-market exposure, including SpaceX, may create greater near-term volatility.
• The shift toward recently activated secondary funds is temporarily pressuring blended fee rates, while private wealth distribution fees are running at roughly $5 million per quarter and are expected to increase with platform assets.

StepStone Group Price Performance

STEP stock traded down $3.92 during midday trading on Friday, reaching $46.41. 5,241,799 shares of the company were exchanged, compared to its average volume of 1,227,498. The business has a 50-day moving average price of $43.92 and a two-hundred day moving average price of $50.37. StepStone Group has a one year low of $38.85 and a one year high of $77.79. The firm has a market capitalization of $5.54 billion, a price-to-earnings ratio of -6.01 and a beta of 1.27.

StepStone Group Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Tuesday, September 15th. Shareholders of record on Monday, August 31st will be issued a dividend of $0.33 per share. The ex-dividend date of this dividend is Monday, August 31st. This represents a $1.32 annualized dividend and a yield of 2.8%. This is a positive change from StepStone Group’s previous quarterly dividend of $0.28. StepStone Group’s payout ratio is -16.47%.

Analyst Ratings Changes

STEP has been the topic of a number of research analyst reports. Evercore restated an “outperform” rating and set a $56.00 price objective on shares of StepStone Group in a report on Friday. BMO Capital Markets reiterated an “outperform” rating and set a $58.00 price objective on shares of StepStone Group in a report on Friday. Weiss Ratings restated a “sell (d-)” rating on shares of StepStone Group in a research note on Monday, July 20th. UBS Group reaffirmed a “buy” rating and issued a $69.00 target price on shares of StepStone Group in a research report on Friday. Finally, Morgan Stanley dropped their target price on StepStone Group from $72.00 to $63.00 and set an “equal weight” rating on the stock in a report on Tuesday, July 21st. Seven investment analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has given a Sell rating to the company’s stock. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $70.88.

Key Stories Impacting StepStone Group

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

• Positive Sentiment: StepStone increased its quarterly dividend by 17.9% to $0.33 per share, implying an annualized yield of approximately 2.8%. The dividend is payable September 15 to shareholders of record August 31. StepStone Group Reports First Quarter Fiscal Year 2027 Results
• Positive Sentiment: A separate earnings analysis highlighted sales growth that exceeded estimates for the reported period, providing a constructive sign for the firm’s operating momentum. StepStone Group sales report
• Neutral Sentiment: Management’s first-quarter fiscal 2027 earnings call provided additional commentary on results and business conditions, but the available report does not specify new guidance or major strategic changes. StepStone Group Q1 2027 Earnings Call Transcript
• Negative Sentiment: StepStone reported quarterly EPS of $0.48, below consensus estimates of roughly $0.50–$0.51, although earnings improved from $0.40 a year earlier. Revenue of $300.6 million also fell short of the approximately $309.3 million consensus estimate. The dual miss likely drove the negative reaction. StepStone Group misses Q1 earnings and revenue estimates

Insider Activity

In related news, COO Jose A. Fernandez sold 100,000 shares of the company’s stock in a transaction dated Monday, June 1st. The shares were sold at an average price of $48.60, for a total value of $4,860,000.00. Following the transaction, the chief operating officer owned 102,290 shares in the company, valued at approximately $4,971,294. This represents a 49.43% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Michael I. Mccabe purchased 120,000 shares of the stock in a transaction on Thursday, June 11th. The stock was bought at an average cost of $41.85 per share, for a total transaction of $5,022,000.00. Following the completion of the acquisition, the insider owned 433,178 shares in the company, valued at approximately $18,128,499.30. This trade represents a 38.32% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. 15.70% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On StepStone Group

Large investors have recently made changes to their positions in the company. Wellington Management Group LLP boosted its position in shares of StepStone Group by 65.2% in the third quarter. Wellington Management Group LLP now owns 5,723,073 shares of the company’s stock valued at $373,774,000 after acquiring an additional 2,257,880 shares during the period. Price T Rowe Associates Inc. MD increased its position in StepStone Group by 16.5% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 5,102,666 shares of the company’s stock worth $327,439,000 after acquiring an additional 724,201 shares during the period. Ameriprise Financial Inc. raised its stake in StepStone Group by 320.8% in the 3rd quarter. Ameriprise Financial Inc. now owns 749,841 shares of the company’s stock worth $48,972,000 after purchasing an additional 571,643 shares in the last quarter. UBS Group AG boosted its holdings in StepStone Group by 401.0% in the 3rd quarter. UBS Group AG now owns 604,518 shares of the company’s stock valued at $39,481,000 after purchasing an additional 483,847 shares during the period. Finally, Balyasny Asset Management L.P. boosted its holdings in StepStone Group by 125.7% in the 2nd quarter. Balyasny Asset Management L.P. now owns 472,270 shares of the company’s stock valued at $26,211,000 after purchasing an additional 263,015 shares during the period. Institutional investors own 55.54% of the company’s stock.

StepStone Group Company Profile

StepStone Group is a global private markets investment firm that provides specialized investment solutions across private equity, private credit and real assets. The firm offers customized portfolios, secondary interests, direct co-investments and tailored advisory services to institutional investors worldwide. StepStone’s integrated research and data analytics platform supports its investment teams in sourcing opportunities and monitoring portfolio companies.

Founded in 2007 as an independent private markets specialist, the company has grown its presence through both organic expansion and strategic partnerships.