Goldman Sachs has lowered its recommendations on two European private markets managers, moving Partners Group and Tikehau Capital from Neutral to Sell as it adopts a more selective view of the regional alternatives space.
The analysts, led by Oliver Carruthers, assigned a price target of 610 Swiss francs to Partners Group - implying roughly 9% downside - and set a 16 euro target for Tikehau Capital, implying about 5% downside. Those targets contrast with Goldman’s broader alternatives coverage, which shows an average upside of about 24%.
Goldman’s note comes after a sector rebound. Since Sept. 30, European alternative managers have risen about 9% on average, while U.S. peers have climbed roughly 12%. The bank attributes part of that recovery to a rotation within financials away from banks and to easing investor concerns around software and private credit.
Despite the market rebound, Goldman described the underlying fundamentals as "mixed." The bank highlighted a deceleration in sponsor exit activity after three years of expansion from the 2023 trough, reporting that activity was down roughly 60% in October.
Client demand was characterized as "relatively resilient but selective," with retail wealth inflows into private credit remaining muted. Additionally, Goldman noted that higher interest rates this year are a headwind for real estate fundraising, even as those same rates may bolster demand for credit and secondaries strategies.
"In this more selective fundraising environment, we see an increasing premium for managers with strong investment performance, distributions, and flagship fundraising visibility," the analysts wrote, underscoring that limited fundraising attention is likely to concentrate on firms with clear performance and distribution track records.
Goldman singled out firm-specific concerns in explaining the Partners Group downgrade. The bank said the investor debate is moving beyond an understood evergreen redemption reset and toward "downside risk to gross inflows and recurring fee economics." At the same time, Goldman described mature-evergreen dynamics as a company-specific issue rather than evidence of widespread weakness across the private markets wealth channel, noting that most large evergreen products outside private credit are still producing positive net flows.
For Tikehau, Goldman acknowledged that the stock has performed positively this year - up about 7% - but flagged a weaker near-term fundraising outlook. The analysts expect fundraising to remain subdued through 2027 and into early 2028. They also see the roll-off of private equity catch-up fees as an additional headwind to fee-related earnings margins.
On that basis, Goldman expects Tikehau’s 2026 fee-related earnings to land at the lower end of the company’s guidance range of 175 million to 225 million, and described the firm’s mid-term guidance as "demanding."
Goldman did not extend the Sell rating across the board. The bank retained Buy ratings on CVC, ICG, EQT and Eurazeo, signaling a selective preference for certain managers where it sees stronger fundamentals or fundraising visibility.
The bank’s action highlights a bifurcated outlook for European private markets managers: valuations have recovered in recent months, yet fundraising, fee dynamics and certain sponsor-related activity remain areas of uncertainty that favor well-positioned managers.