Is Kroll Partnership on Private Credit Benchmarks Changing the Investment Case for StepStone Group (STEP)?

• In recent news, Kroll and StepStone Group announced the launch of the Kroll StepStone Private Credit Benchmarks, an industry-first offering that utilizes data from more than 15,000 private credit deals to enhance market transparency and valuation accuracy.
• This collaboration addresses the growing investor need for better analytics amid increased retail participation in private markets, positioning StepStone as a provider of advanced portfolio intelligence tools.
• We'll take a closer look at how StepStone's push toward market transparency with private credit benchmarks could influence its investment story.

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What Is StepStone Group's Investment Narrative?

To buy into StepStone Group’s investment story, you need to believe the long-term opportunity in private markets outweighs the risks of inconsistent earnings and patchy profitability. The recent launch of private credit benchmarks with Kroll positions StepStone as a technology-forward player aiming for market transparency, addressing a growing appetite for better data among investors. This partnership could become an important near-term catalyst if it attracts new clients or higher-margin flows, especially as private credit expands its footprint. However, StepStone remains unprofitable and its losses have increased in recent years, raising questions about how quickly innovation can translate into financial gains, particularly after its recent drop from key indices and amid continued insider selling. If the Kroll venture drives sustained client interest, risks tied to earnings volatility may ease, but the impact will need time to show in results.
On the other hand, ongoing net losses remain something investors should keep front of mind.

StepStone Group's share price has been on the slide but might be dropping deeper into value territory. Find out whether it's a bargain at this price.

Exploring Other Perspectives

The Simply Wall St Community’s fair value estimates for StepStone stand uniformly at US$9.43, reflecting a single viewpoint that suggests extreme undervaluation compared to recent prices. While participants seem aligned here, StepStone’s unprofitable track record and slow revenue growth emphasize the importance of considering differing opinions about future performance. You may want to review these alternative perspectives carefully before drawing conclusions.

Explore another fair value estimate on StepStone Group - why the stock might be worth less than half the current price!

Build Your Own StepStone Group Narrative

Disagree with this assessment? Create your own narrative in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your StepStone Group research is our analysis highlighting 3 important warning signs that could impact your investment decision.
• Our free StepStone Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate StepStone Group's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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