KKR Quantitative Stock Analysis

Validea's guru fundamental report rated KKR & CO INC (KKR), a large-cap investment services firm, at 68% using the Motley Fool's Small-Cap Growth Investor model. This score is below the 80% threshold for 'some interest' in the strategy, primarily due to KKR failing key metrics like cash flow from operations, profit margin consistency, and its P/E to Growth ratio, despite passing on profit margin and relative strength.

Analysis

According to a Validea fundamental report, KKR & Co. Inc. (KKR) scored a 68% rating based on a model derived from the Motley Fool's small-cap growth strategy. This score is notably below the 80% threshold that would indicate strategic interest, reflecting a mixed quantitative assessment. A key contextual point is the application of a small-cap model to KKR, a large-cap firm, which may influence the relevance of certain criteria. The analysis reveals a company with distinct strengths and weaknesses. KKR passed on metrics including current profit margin, relative price strength, year-over-year sales and EPS growth, and insider holdings. However, these positives are offset by significant failures in crucial areas such as cash flow from operations, profit margin consistency, and an unfavorable P/E-to-growth valuation ("The Fool Ratio"). Additional flags were raised on metrics like average shares outstanding and income tax percentage, contributing to the suboptimal final score.

Key Decisions for Investors

• Investors should treat this report as a neutral-to-cautious signal, as the 68% score from a potentially mismatched small-cap model does not provide a strong conviction case.
• The failure on cash flow from operations and profit margin consistency warrants further due diligence, as these metrics are critical indicators of underlying business quality and long-term stability.
• Given the FAIL rating on the P/E-to-growth ratio, investors focused on growth-at-a-reasonable-price (GARP) should scrutinize KKR's current valuation relative to its growth outlook.
• While the PASS on insider holdings is a positive sign of management alignment, it should be weighed against the fundamental weaknesses identified in the quantitative screen before initiating or adding to a position.