StepStone Group (NASDAQ:STEP) Releases Earnings Results, Misses Estimates By $0.02 EPS

StepStone Group (NASDAQ:STEP) released its earnings results on Thursday. The company reported $0.48 earnings per share for the quarter, missing the consensus estimate of $0.50 by ($0.02), FiscalAI reports. The business had revenue of $300.60 million for the quarter, compared to analysts’ expectations 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 Trading Down 7.8%

StepStone Group stock traded down $3.92 during trading hours on Friday, reaching $46.41. 5,241,799 shares of the company were exchanged, compared to its average volume of 1,227,498. The firm has a market cap of $5.54 billion, a price-to-earnings ratio of -6.01 and a beta of 1.27. The stock has a 50-day moving average of $43.92 and a 200 day moving average of $50.37. StepStone Group has a 12 month low of $38.85 and a 12 month high of $77.79.

StepStone Group Increases Dividend

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

Insiders Place Their Bets

In related news, COO Jose A. Fernandez sold 2,290 shares of the company’s stock in a transaction on Wednesday, June 3rd. The shares were sold at an average price of $42.64, for a total transaction of $97,645.60. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Michael I. Mccabe bought 120,000 shares of the company’s stock in a transaction that occurred on Thursday, June 11th. The stock was purchased at an average price of $41.85 per share, for a total transaction of $5,022,000.00. Following the acquisition, the insider directly 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 currently owned by insiders.

Hedge Funds Weigh In On StepStone Group

Several institutional investors and hedge funds have recently added to or reduced their stakes in the company. Wellington Management Group LLP raised its stake in shares of StepStone Group by 65.2% in the 3rd quarter. Wellington Management Group LLP now owns 5,723,073 shares of the company’s stock valued at $373,774,000 after buying an additional 2,257,880 shares in the last quarter. Price T Rowe Associates Inc. MD raised its position in StepStone Group by 16.5% in 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 purchasing an additional 724,201 shares in the last quarter. Ameriprise Financial Inc. raised its position in StepStone Group by 320.8% in the third 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 lifted its stake in StepStone Group by 401.0% during the third quarter. UBS Group AG now owns 604,518 shares of the company’s stock worth $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% during the second 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 in the last quarter. 55.54% of the stock is currently owned by institutional investors.

Analyst Ratings Changes

A number of equities research analysts have issued reports on STEP shares. BMO Capital Markets reiterated an “outperform” rating and issued a $58.00 target price on shares of StepStone Group in a research report on Friday. Weiss Ratings reaffirmed a “sell (d-)” rating on shares of StepStone Group in a research note on Monday, July 20th. Morgan Stanley reduced their price objective on StepStone Group from $72.00 to $63.00 and set an “equal weight” rating for the company in a research report on Tuesday, July 21st. UBS Group restated a “buy” rating and issued a $69.00 target price on shares of StepStone Group in a research note on Friday. Finally, Oppenheimer dropped their target price on StepStone Group from $90.00 to $85.00 and set an “outperform” rating on the stock in a research report on Thursday, May 21st. Seven equities research analysts have rated the stock with a Buy rating, two have assigned a Hold rating and one has assigned a Sell rating to the company’s stock. Based on data from MarketBeat, the company presently has an average rating of “Moderate Buy” and a consensus target price of $70.88.

Key Headlines 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

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.