Alternative Asset Managers Show Confidence with Dividend Increases

Three alternative asset managers—each with strong business models—are raising their dividends.

Over the past 20 years, the significance of alternative assets, including private equity, hedge funds, real estate, infrastructure, and venture capital, has surged. These assets constituted just 6% of all global assets under management (AUM) but now represent 15%. Industry analysts project continued growth, with expectations of around 10% annual increases through 2029, making this sector one to watch.

The moves by these firms to return more capital to shareholders signal confidence in a fluctuating market environment.

KKR: Increasing Dividends on the Road to $1 Trillion AUM

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First on the list is KKR & Co. Inc. (NYSE: KKR), a private equity firm that has announced a modest 5.7% increase in its quarterly dividend. The upcoming 18.5 cents per share dividend is set to be distributed on May 27 to shareholders of record on May 12.

With an annual dividend payment now at 74 cents, KKR offers a dividend yield of 0.6%. Although this yield is relatively low, KKR has consistently raised its dividends annually since it began payments in 2018.

This recent increase marks KKR’s sixth consecutive dividend boost. Traditionally a private equity investor, KKR has developed a diversified portfolio encompassing multiple asset classes. Credit strategies now constitute around 38% of its $664 billion portfolio, while real assets make up approximately 26%, and private equity strategies account for about 33%.

Ambitiously, KKR aims to reach $1 trillion in AUM by 2030 and plans to grow its annual adjusted net income (ANI) per share to $15. This goal requires tripling its current ANI of $4.88 over the last 12 months (LTM).

KKR has shown strong execution, growing its AUM by 15% from the previous year and its LTM ANI by 37%. Sustaining these growth rates suggests KKR is well-positioned to meet its targets.

APO: Seizing Opportunities After Liberation Day

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Next is Apollo Global Management (NYSE: APO), which is implementing a notable dividend increase of just over 10%, raising it to 51 cents per share. This payment will be made on May 30 to shareholders of record on May 16.

Primarily a credit investor, Apollo reported that this asset class accounted for about 88% of its nearly $600 billion in fee-bearing capital last quarter, with the remainder in equities.

Apollo achieved a remarkable Q1 2025, generating record fee-related earnings of $559 million and witnessed a significant inflow of AUM.

These robust earnings played a crucial role in Apollo’s decision to announce its largest dividend increase to date. With this adjustment, the company now offers a dividend yield of around 1.5%, slightly above the S&P 500 Index’s approximate 1.2% yield.

During its earnings call, Apollo emphasized its major investments following President Trump’s Liberation Day tariff announcement. The increased market volatility has presented the firm with ample buying opportunities, allowing Apollo to deploy $25 billion in capital in April alone.

OWL: Significant Dividend Increase Aligns with Strong Growth

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Finally, Blue Owl Capital (NYSE: OWL), a relatively new player in publicly traded alternative asset management, has raised its dividend by an impressive 25%.

Since its public debut in 2021, Blue Owl has increased its quarterly dividend eight times and consistently raised annual payouts. The new 22.5 cents per share dividend will be payable on May 28 to shareholders of record on May 14. With an indicated annual payment of 90 cents, the stock now offers a robust 4.9% dividend yield.

The majority of Blue Owl’s $273 billion in AUM is derived from credit strategies, which account for 51%. General Partner Strategic and Real Assets each represent about 25%.

The General Partner Strategic strategy, known as “GP stakes,” is particularly intriguing. Blue Owl takes minority positions in other private equity and hedge fund firms, allowing it to earn a share of the profits from these investments. This strategy enables Blue Owl to gain insights and returns from specialized investment areas it may not pursue independently.

In summary, Blue Owl’s investment model is about backing other skilled investors to leverage their expertise.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.