Blue Owl Capital Launches $7 Billion Meta AI Data Center Venture

Meta Platforms has partnered with Blue Owl Capital in a $7 billion joint venture to develop the Hyperion data center campus, signaling a significant expansion into AI-linked digital infrastructure. Blue Owl holds an 80% stake in this venture, underscoring its strategic move into mission-critical data centers and long-term commitment to AI growth. Despite this major project, Blue Owl faces near-term risks related to fundraising slowdowns and capital inflow volatility, which could impact earnings and fee revenue. Analysts have mixed views: JP Morgan maintains a "Neutral" rating on Blue Owl while raising its price target slightly to $22, reflecting cautious optimism amid mostly downward price target revisions from other firms. Blue Owl's share price has declined nearly 29% year-to-date, although its three-year total shareholder return remains strong at 86%, suggesting potential undervaluation given its ambitious expansion plans. Investors should consider both the promising growth prospects linked to digital infrastructure leadership and the risks from rapid expansion and fundraising dependencies.