The Blackstone Group L.P. (BX - Free Report) is scheduled to report its fourth-quarter and 2016 results before the opening bell on Thursday, Jan 26.
Last quarter, the company reported a positive earnings surprise of 11.8%. Better-than-expected results were attributable to a significant rise in revenues, partially offset by higher expenses.
The earnings beat and the Trump-induced rally led to improved price performance for Blackstone. For the three-months ended Dec 31, 2016, the company’s shares gained 7.3%.
Moreover, Blackstone has a decent earnings surprise history, as evident from the chart below:
What to Expect in Q4?
On the expense side, the overall uptrend in costs is anticipated to have continued in the fourth quarter. This is due to higher compensation and benefit costs, as the company’s well-performing funds require more headcount.
Further, flow trends are expected to remain weak during the quarter. As such Blackstone is likely to record a slowdown in inflows.
Blackstone remains comparatively immune to the prevalent low interest rate environment as it chiefly deals in asset management and private equity businesses. Also, the company continues to expand its investment activity to capitalize on public market dislocation and should report higher deployment of capital during the quarter.
Furthermore, with the improvement in the overall economic scenario, the company’s fund-raising ability should aid the uptrend in its fee-earning AUM (assets under management) and total AUM. This will lead to stable or improving fee income for the company.
Also, Blackstone’s activities during the quarter seem to have won the analysts’ confidence. As a result, the Zacks Consensus Estimate for the quarter has risen 4.9% to 64 cents, over the past 30 days.
Earnings Whispers
Our proven model indicates that Blackstone is less likely to beat the earnings estimates this time around. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy) or at least #2 (Buy) or #3 (Hold) for this to happen.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Unfortunately, this is not the case here as elaborated below.
Zacks ESP: The Earnings ESP for Blackstone is -1.56%. This is because the Most Accurate estimate of 63 cents is lower than the Zacks Consensus Estimate of 64 cents.
Zacks Rank: Blackstone’s Zacks Rank #2 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of a positive earnings surprise.
Stocks that Warrant a Look
Here are some stocks you may want to consider as our proven model shows they have the right combination of the elements to beat earnings this season.
SEI Investments Co. (SEIC - Free Report) is scheduled to report results on Jan 25. The company has an Earnings ESP of +6.00% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Raymond James Financial, Inc. (RJF - Free Report) has an Earnings ESP of +1.00% and carries a Zacks Rank #2. The company is slated to release results on Jan 25.
T. Rowe Price Group, Inc. (TROW - Free Report) has an Earnings ESP of +2.16% and carries a Zacks Rank #3. It is scheduled to report results on Jan 26.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
The Blackstone Group L.P. (BX - Free Report) is scheduled to report its fourth-quarter and 2016 results before the opening bell on Thursday, Jan 26.
Last quarter, the company reported a positive earnings surprise of 11.8%. Better-than-expected results were attributable to a significant rise in revenues, partially offset by higher expenses.
The earnings beat and the Trump-induced rally led to improved price performance for Blackstone. For the three-months ended Dec 31, 2016, the company’s shares gained 7.3%.
Moreover, Blackstone has a decent earnings surprise history, as evident from the chart below:
What to Expect in Q4?
On the expense side, the overall uptrend in costs is anticipated to have continued in the fourth quarter. This is due to higher compensation and benefit costs, as the company’s well-performing funds require more headcount.
Further, flow trends are expected to remain weak during the quarter. As such Blackstone is likely to record a slowdown in inflows.
Blackstone remains comparatively immune to the prevalent low interest rate environment as it chiefly deals in asset management and private equity businesses. Also, the company continues to expand its investment activity to capitalize on public market dislocation and should report higher deployment of capital during the quarter.
Furthermore, with the improvement in the overall economic scenario, the company’s fund-raising ability should aid the uptrend in its fee-earning AUM (assets under management) and total AUM. This will lead to stable or improving fee income for the company.
Also, Blackstone’s activities during the quarter seem to have won the analysts’ confidence. As a result, the Zacks Consensus Estimate for the quarter has risen 4.9% to 64 cents, over the past 30 days.
Earnings Whispers
Our proven model indicates that Blackstone is less likely to beat the earnings estimates this time around. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy) or at least #2 (Buy) or #3 (Hold) for this to happen.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Unfortunately, this is not the case here as elaborated below.
Zacks ESP: The Earnings ESP for Blackstone is -1.56%. This is because the Most Accurate estimate of 63 cents is lower than the Zacks Consensus Estimate of 64 cents.
Zacks Rank: Blackstone’s Zacks Rank #2 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of a positive earnings surprise.
Stocks that Warrant a Look
Here are some stocks you may want to consider as our proven model shows they have the right combination of the elements to beat earnings this season.
SEI Investments Co. (SEIC - Free Report) is scheduled to report results on Jan 25. The company has an Earnings ESP of +6.00% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Raymond James Financial, Inc. (RJF - Free Report) has an Earnings ESP of +1.00% and carries a Zacks Rank #2. The company is slated to release results on Jan 25.
T. Rowe Price Group, Inc. (TROW - Free Report) has an Earnings ESP of +2.16% and carries a Zacks Rank #3. It is scheduled to report results on Jan 26.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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