Apollo Global Management LLC (NYSE:APO) announced Friday a 95 percent increase in its fourth quarter earnings to $697 million or $1.69 per share. The alternative investment firm said that gains from private equity holdings more than compensated for weaker performances in other businesses. The earnings were reported as economic net income that includes unrealized gains. Analysts polled by Bloomberg were expecting an average of 93 cents in earnings.

Apollo Global

The New York-based Apollo Global Management earned $172 million, an increase $11 million compared to the same period a year ago and based on the generally accepted accounting principles. Apollo’s strong results are in line with similar good reports from its rivals KKR & Co. L.P. (NYSE:KKR) and The Blackstone Group L.P. (NYSE:BX). A rebounding real estate market and a 13 percent rise in stocks during 2012 have increased the value of private equity firms’ holdings. As a result, management fees has also increased.

The private equity unit was the strongest division of Apollo Global Management LLC (NYSE:APO) where earnings more than tripled during the fourth quarter to $609 million. However, earnings from the credit investment business fell 36 percent to $90 million. Losses in its real estate unit narrowed to $2.1 million during the quarter. The company’s asset under management rose from $109.7 billion at the end of Q3 to $113.4 billion.

The biggest gains in Apollo’s holdings came from Realogy Holdings Corp (NYSE:RLGY) which jumped 55 percent in the fourth quarter, and Metals USA Holdings Corp (NYSE:MUSA), that rose 31 percent during the same period. Apollo also acquired The McGraw-Hill Companies, Inc. (NYSE:MHP) in a $2.5 billion deal. McGraw-Hill is suffering from declines in school and college enrollments. It is also facing competition from other digital education products. Apollo Global Management LLC (NYSE:APO) also agreed to acquire the American annuity and life insurance business of Aviva Plc for $1.8 billion.

Barclays PLC said in a research report that Apollo Global Management LLC (NYSE:APO)’s earnings were better than its estimate of $0.91 per share. The earnings were primarily driven by better than expected net carried interest. Barclays analysts estimated it to be $328 million, but the actual net carried interests came at $597 million. The net realized performance fee of $330 million was also better than Barclays’ estimate of $121 million. Distributable earnings stood at $1.05 per share, compared to Barclays estimate of $0.42.

Barclays PLC said that Apollo has been one of the strongest private equity firms. Shares of the company have risen 61 percent since July 2012, compared to 8 percent increase in S&P 500 (INDEXSP:.INX). Analysts are also optimistic about Apollo’s first quarter earnings. Barclays maintains an Overweight rating with $23 price target. Bank of America Merrill Lynch also has $23 price target.

Apollo Global Management LLC (NYSE:APO) shares were up 3.02 percent to $22.82 in New York trading.