I’ve had a sneaking admiration for FTSE 100-listed private equity investment group ICG (LSE: ICG) for years. Lately, I appear to be in a minority, as the shares have swung out of favour. But does that make now the ideal moment to step in?

Previously known as Intermediate Capital Group, ICG is a global alternative asset manager providing capital for acquisitions, pre-IPO financing and management buy-outs. A key reason it’s struggled is broader caution around private equity, due to higher interest rates, shrinking liquidity and exit strategy struggles.

The ICG share price has fallen 15% in the last month and is down almost 30% over the year. In fact, it’s trading at levels last seen six or seven years ago. Is this kind of opportunity that only appears once in a decade or so?

ICG shares back on my radar

Here’s one big attraction. The shares now trade on a modest price-to-earnings ratio of just 11.1. And here’s another. The trailing dividend yield has climbed to 4.75%. ICG has a handy track record of rewarding shareholders. It’s increased its dividend every year this century, with the sole exception of the financial crisis in 2009. Over the past decade, payouts have grown at a compound annual rate of 14.2%.

On paper at least, this looks like a classic case of sentiment driving the price lower, while fundamentals hold steady. Last month, ICG reported an 11% rise in total assets under management to $127bn during Q3, with $85bn of that fee-earning. That’s up 1% on Q2 and 11% year-on-year. It also holds $36bn of so-called ‘dry powder’, capital ready to be deployed, although $19bn of that isn’t yet generating fees. During the period, it raised a further $4.4bn.

Transaction activity is “continuing to show modest recovery”, which is hardly boom-time language. But net financial debt’s fallen from £401m to £239m, leaving the balance sheet in decent shape. In short, it’s not flying, but it’s solid.

Massive share price target

Here’s the part that catches my eye. Fourteen analysts have set one-year price targets, producing a consensus of 2,554p. If that does prove accurate, that’s a blockbuster increase of more than 45% from today’s 1,755p. Add in the dividend and the potential total return nudges 50%.

Nine of those 14 brokers rate the stock a Strong Buy, with just two suggesting Sell. Of course, broker forecasts are educated guesses rather than guarantees, and risks remain. Private markets remain highly sensitive to interest rates and economic conditions. Sluggish dealmaking, tighter liquidity and delayed exits can hit fees and investment realisations.

Competition’s intense too, as large US rivals compete aggressively on fundraising and fees. Performance fees can surge in strong markets, but they’re volatile, which adds another layer of uncertainty.

All told, I think ICG shares are worth considering, but only for investors prepared to stomach some short-term volatility. I’m sorely tempted myself. I’ve been waiting three years for an entry point like this. Now I seem to have it. I just need to summon the courage to press the Buy button.