Morningstar

BlackRock Earnings: Positive Flows Offset Market Losses to Lift AUM to Record Levels

We remain conservative with our near-term assumptions for BlackRock and the rest of the US-based asset managers.

BlackRock offices in New York City.
Erik McGregor/LightRocket via Getty
Securities in This Article
BlackRock Inc
(BLK)

Key Morningstar Metrics for BlackRock

  • Fair Value Estimate
    : $1,280.00
  • Morningstar Rating
    : ★★★★
  • Morningstar Economic Moat Rating
    : Wide
  • Morningstar Uncertainty Rating
    : High

What We Thought of BlackRock’s Earnings

BlackRock BLK ended September 2026 with a record $15.488 trillion in assets under management, up 0.9% sequentially and 15.5% year over year. The firm benefited from solid flows for its active and exchange-traded fund platforms, more than offsetting market losses during the quarter.

Why it matters: BlackRock continues to outperform its traditional asset management peers from an organic AUM growth perspective, with its mix of index funds and ETFs, while an expansion of its private capital platform has only added to its ability to consistently generate positive flows.

  • Net inflows of $175 billion during the quarter represented an annualized organic AUM growth rate of 5.2%, just above the top end of our annual target rate range of 3%-5%. We expect lower rates of growth from most of BlackRock’s peers when they report their third-quarter results.
  • The iShares platform remains the biggest driver of flows for BlackRock, with the company picking up $135 billion in net inflows, equivalent to an 8.6% annualized organic AUM growth rate, from its ETF business during the September quarter.

The bottom line: We expected the third quarter to be difficult, given how both the equity and credit markets traded off after the Fed raised short-term rates last month and signaled that more hikes could be coming, with the US equity markets increasing just 2.3% while the US bond markets declined 3.4% during the period.

  • We expect to leave our $1,280 per share fair value estimate for wide-moat BlackRock in place. We view the shares as modestly undervalued right now, trading at around a 15% discount to our fair value estimate.
  • We remain conservative with our near-term assumptions for BlackRock and the rest of the US-based asset managers, believing that the ongoing Iran war, as well as US fiscal and monetary policies, will keep the equity and fixed-income markets more volatile (with a good chance of a downward move in the markets) in the near term.

Editor’s Note: This analysis was originally published as a stock note by Morningstar Equity Research.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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