What Happened?

Shares of private equity firm Carlyle Group (NASDAQ: CG) fell 5.7% in the afternoon session after the company reported third-quarter financial results where revenue fell significantly short of analysts' expectations, alongside a slight miss on fee-related earnings. The global investment firm generated revenue of $782.5 million, a 12.6% decline from the previous year and a 20.7% miss against Wall Street's forecast of $987.3 million. Additionally, fee-related earnings, a key measure of recurring profitability for asset managers, came in at $311.9 million, narrowly missing estimates. The results were not all negative, as the firm's Assets Under Management (AUM) grew 5.9% year-over-year to $474 billion, beating expectations by 6%. However, investors appeared to focus on the significant revenue shortfall, which drove the negative sentiment around the stock.

The shares closed the day at $53.31, down 5.8% from previous close.

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What Is The Market Telling Us

Carlyle’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 18 days ago when the stock gained 3.4% on the news that the company, along with the Qatar Investment Authority, entered into a binding agreement to acquire a 60% stake in several of German chemical company BASF's coatings businesses. The transaction carried an enterprise value of €7.7 billion. The deal covered BASF's Automotive OEM Coatings, Automotive Refinish Coatings, and Surface Treatment businesses. As part of the agreement, BASF planned to reinvest in the coatings business, holding the remaining 40% equity stake. The deal, which remained subject to customary regulatory approvals, was expected to close in the second quarter of 2026.

Carlyle is up 5.1% since the beginning of the year, but at $53.32 per share, it is still trading 23.1% below its 52-week high of $69.35 from September 2025. Investors who bought $1,000 worth of Carlyle’s shares 5 years ago would now be looking at an investment worth $2,100.

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