Blackstone Earnings: Weaker Capital Deployment and Increased Redemptions Affect Results

While there was little in narrow-moat Blackstone's first-quarter results that would alter our long-term view of the firm, we expect to reduce our fair value estimate slightly to adjust for weaker flows and realizations in the near term than we projected. We view Blackstone as being moderately undervalued right now and envision the stock potentially getting a boost in the near term if it is added to the S&P 500 index (now that S&P Dow Jones Indices has relaxed its criteria to allow firms with more than one class of stock into its U.S. indexes).