What StepStone Group (STEP)'s Aviva Partnership and New Distribution Deals Mean for Private Markets Access

• In recent days, BMO Capital initiated coverage of StepStone Group with an Outperform rating, highlighting its strong position in the secondaries market, while StepStone also expanded its reach through new distribution agreements and a partnership with Aviva to provide UK pension schemes with institutional access to global private markets.
• These developments underscore StepStone's growing influence in private markets and its ability to attract institutional and retirement-focused investors through differentiated offerings.
• We'll explore how StepStone's expanding institutional partnerships, especially with Aviva, shape the company's investment narrative in private markets.

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What Is StepStone Group's Investment Narrative?

For anyone considering StepStone Group, the core narrative centers on its role as a facilitator of global private market access, particularly through secondaries and expanding institutional partnerships. The recent deal with Aviva, giving UK pension schemes institutional-grade entry to private market opportunities, fits perfectly into this long-term vision and bolsters StepStone’s brand with retirement-focused clients. Simultaneously, partnerships like the one with Crowd Street highlight further distribution expansion. However, recent earnings indicated missed analyst targets for both AUM and earnings, pointing to challenges in delivering profitable growth despite quickening revenues. Taken together, these developments suggest the underlying investment thesis remains intact, but earnings execution and portfolio performance persist as the main short-term catalysts, and risks. Recent analyst optimism had a modest impact on the share price, implying that news flow may not dramatically shift investor conviction without clearer improvement in fundamentals. Yet, StepStone’s ongoing losses and questions around the sustainability of its dividend are risks investors should not overlook.

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Exploring Other Perspectives

The Simply Wall St Community sees fair value clustered at US$9.26 from one analysis, signaling an extreme disconnect with the market. While some participants stick to conservative views, short-term catalysts like new partnerships and ongoing earnings pressure could shape sentiment much more broadly moving forward.

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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