The Carlyle Group’s big bet on a trendy fashion brand paid off in the fourth quarter of 2020, helping the firm to an earnings day surprise that sent its stock soaring.
Carlyle posted net income of $518.8 million in Q4, a sharp turnaround after the firm lost around $8 million in the same period a year earlier.
That boost was driven in large part by selling its stake in Supreme, a New York-based streetwear company, to apparel conglomerate VF in a November deal that valued Supreme at around $2.1 billion. The exit came just three years after Carlyle bought a 50% stake in the company for half that price.
In addition to the spike in income, Carlyle’s distributable earnings jumped to $236.9 million in Q4 2020, or 64 cents per share. That easily outpaced reported analyst expectations of 44 cents per share.
Carlyle’s private equity portfolio appreciated 11% over the final three months of the year, slightly trailing the S&P 500’s 11.7% gain. Add it all up, and Carlyle’s shares soared 7% on Thursday, taking the Washington, DC-based firm’s market cap to some $12.7 billion.
Source: Pitchbook
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