Shares in Petershill Partners PLC (LSE:PHLL), the closed-ended private equity fund run by Goldman Sachs, are trading at a 40-50% discount to the valuation the company would warrant as an "actual private market manager", according to UBS.
Half-year results are due on Friday 8 September and UBS sees the potential for a surprise.
The main focus from investors will be on its partner fee-related earnings (FRE), where the consensus forecast is for US$105.6 million, and partner distributable earnings, at US$137.3 million.
UBS sees the "main delta" in the distributable earnings as its above-consensus forecast for the first half of US$42 million compared to the consensus estimate of US$20 million, with the consensus expecting the performance fee earnings to be more heavily weighted to the second half.
"We think the market is applying a discount on PHLL's shares as a result of its unique structure as a closed-end fund," UBS said.
"Given the close correlation between the contribution of management fees to total revenues and valuation multiples, we estimate the market assigns a 40-50% discount to Petershill's valuation vs. an actual private market manager."