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Blackstone Inc BX

Morningstar Rating
$114.28 +1.91 (1.70%)
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Company Report

U.S.-Based Asset Managers: Market Rally Benefits AUM, but Revenue and Profits Won't Recover Quickly

While the runup in the equity markets the past several weeks is likely to have a positive impact on assets under management for the U.S.-based asset managers, we don't expect it to have too significant an impact on our fair value estimates, which are based on 10-year forecasts for AUM growth, fee rates, revenue, and profitability. As of the Nov. 29 market close, the traditional U.S.-based asset managers we cover were trading at an average price/fair value multiple of 0.97, making them only slightly undervalued, while the alternative-asset managers we cover were trading at an average price/fair value multiple of 1.09. This is far from the margin of safety we would need to recommend these more volatile names to long-term investors.

Price vs Fair Value

BX is trading at a 4% premium.
Price
$114.28
Fair Value
$288.00
Uncertainty
High
1-Star Price
$233.80
5-Star Price
$29.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Blackstone, with $731.1 billion in fee-earning AUM at the end of June 2023, is a "go-to firm" for institutional and high-net-worth investors looking for exposure to alternative assets.

Bears

Downturns in the equity and credit markets could leave potential investors in Blackstone's funds with limited liquidity and large commitments to other funds, making it more difficult for the firm to raise new capital.

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News

Trading Information

Previous Close Price
$112.37
Day Range
$112.20114.43
52-Week Range
$71.72116.78
Bid/Ask
$114.00 / $114.39
Market Cap
$85.70 Bil
Volume/Avg
3.9 Mil / 6.2 Mil

Key Statistics

Price/Earnings (Normalized)
47.51
Price/Sales
10.11
Dividend Yield
2.91%
Dividend Yield (Forward)
2.91%
Total Yield
3.35%

Company Profile

Blackstone is the world's largest alternative asset managers with $1.001 trillion in total asset under management, including $731.1 billion in fee-earning asset under management, at the end of June 2023. The company has four core business segments: private equity (23% of fee-earning AUM and 27% of base management fees); real estate (39% and 44%); credit & insurance (28% and 21%); and hedge fund solutions (10% and 8%). While the firm primarily serves institutional investors (87% of AUM), it also caters to clients in the high-net-worth channel (13%). Blackstone operates through 25 offices located in the Americas (8), Europe and the Middle East (9), and the Asia-Pacific region (8).
Sector
Financial Services
Industry
Asset Management
Stock Style Box
Large Value
Total Number of Employees
4,695

Competitors

Valuation

Metric
BX
CG
KKR
Price/Earnings (Normalized)
47.5128.6522.42
Price/Book Value
12.142.143.25
Price/Sales
10.114.625.40
Price/Cash Flow
17.2540.79
Price/Earnings
BX
CG
KKR

Financial Strength

Metric
BX
CG
KKR
Quick Ratio
4.06
Current Ratio
4.09
Interest Coverage
1.34
Quick Ratio
BX
CG
KKR

Profitability

Metric
BX
CG
KKR
Return on Assets (Normalized)
7.43%1.57%0.93%
Return on Equity (Normalized)
41.96%5.46%14.34%
Return on Invested Capital (Normalized)
1.63%
Return on Assets
BX
CG
KKR

Asset Management Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
BLK
BlackRock IncZjsd$112.5 Bil
KKR
KKR & Co Inc Ordinary SharesLstnnhx$66.3 Bil
BK
Bank of New York Mellon CorpKrbfw$37.5 Bil
AMP
Ameriprise Financial IncMlnjkc$36.1 Bil
TROW
T. Rowe Price Group IncPgnp$22.9 Bil
STT
State Street CorporationPmky$22.8 Bil
NTRS
Northern Trust CorpSjnb$16.6 Bil
CG
The Carlyle Group IncTzbbnk$12.7 Bil
BEN
Franklin Resources IncFczpss$12.7 Bil