US Asset Managers "Alts SMID Cap Wrap: Reiterate Buy on Both HLNE & STEP" Brown

Research evidence excerpt

US Asset Managers "Alts SMID Cap Wrap: Reiterate Buy on Both HLNE & STEP" Brown

Global Research

22 May 2026ab

US Asset Managers Equities

AmericasAlts SMID Cap Wrap: Reiterate Buy on Both

HLNE & STEP Financial

Michael Brown

Analyst

mike.brown@ubs.com

Our Take on HLNE's quarter +1-212-713 1387

HLNE delivered a solid quarter that came in better than feared, despite a challenging Vijeth Mudalegundi

backdrop for private markets. HLNE shares traded up ~4.1%, and outperformed the alts Analyst

group by 2%, with core mgmt fees relatively in-line and FRE ahead Street ests by 1%. vijeth.mudalegundi@ubs.com

Evergreen flows, while slower in March/April, remained positive overall with no +1-212-649 8172

proration and closed-end fundraising visibility also improved, with progress across Mary Mahrer

multiple strategies and a robust pipeline supporting forward growth. Taken together, Analyst

the print was not without some near-term noise, but reinforced a “good enough” mary.mahrer@ubs.com

outcome with a constructive trajectory into the back half of the year. Trading at 12.4x +1-212-713 9014

CY27 EPS, we view the stock as attractively valued relative to its low/mid teens FRE Daniel Lehmann

growth. Associate Analyst

daniel-j.lehmann@ubs.com

Specialized Funds: Closed-end fundraising still strong, evergreen slower near- +1-212-713 2391

term Cory Johnson

On the evergreen fund business, monthly data points to a moderation in subscription Associate Analyst

activity, with April inflows expected at ~$265mm versus ~$471mm/~$591mm in Jan/ cory.johnson@ubs.com

Feb following negative private wealth sentiment. Management characterized this as +1-212-882 0078

temporary, with expectations for a reacceleration, alongside the wealth distribution

build-out for the product offering.