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The Blackstone Group (BX - Free Report) is a Zacks Rank #5 (Strong Sell) that is an alternative asset management firm specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity, and multi-asset class strategies.
The stock has recently rallied with other financial stocks, but investors might be getting ahead of themselves as the stock approaches 2023 highs.
A Q3 earnings miss that resulted in analysts dropping estimates should be viewed as a caution flag as we head into 2024.
About the Company
Blackstone has become one of the most recognizable names on Wall Street of late. It was founded in 1985 and is headquartered in New York, New York.The company employs over 4,500 people, with additional offices across Asia, Europe, North America, and Central America.
The company operates its businesses through four segments: Private Equity, Real Estate, Hedge Fund Solutions, and Credit & Insurance. As of Sep 30, 2023, total AUM was $1.01 trillion and fee-earning AUM was $734.5 billion.
BX is valued at $77 billion and has a Forward PE of 28. The stock holds Zacks Style Scores of “F” in Momentum and Value. BX pays a dividend of 3%.
Q3 Earnings
The Blackstone Group reported Q3 EPS back in October, posting a 4% surprise to the downside. The quarter was affected by a slow-deal making environment that resulted in lower asset sales.
Management commentary was very cautious in tone, but this was before the recent market rally. While the atmosphere has changed over the last month, estimates are still drifting lower since the earnings report.
Estimates
Over the last 60 days, numbers for the current quarter have been taken down from $1.27 to $1.05, or 17%.
For the current year, analysts have lowered estimates by 7% over that same time frame.
Looking at the longer term, numbers are going lower as well. For next year, estimates have fallen from $5.92 to $5.32, or over 10%.
The stock sold off after earnings but has rallied over 25% since the October low. Market forces have helped financials and BX, but investors should be looking to take profits into this up move.
Technical Take
The stock has traded in a sideways pattern since early 2022. The trading range has seen support around the $75-80 levels and resistance between $110-120. With the stock at $112 as of this writing, investors should be looking to take chips off the table.
Better entries below the current price include the 50-day moving average at $103 and the 200-day currently resides at $95.50
In Summary
While the fundamental environment might be shifting in favor of Blackstone, analysts are not on board yet. Investors should be taking chips off the table and looking for fresh entries at lower prices.
For those interested in the space, a better option might be Blue Owl Capital (ODBC). The stock is a Zacks Rank #1 (Strong Buy) that is trading close to 2022 highs.
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Bear of the Day: The Blackstone Group (BX)
The Blackstone Group (BX - Free Report) is a Zacks Rank #5 (Strong Sell) that is an alternative asset management firm specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity, and multi-asset class strategies.
The stock has recently rallied with other financial stocks, but investors might be getting ahead of themselves as the stock approaches 2023 highs.
A Q3 earnings miss that resulted in analysts dropping estimates should be viewed as a caution flag as we head into 2024.
About the Company
Blackstone has become one of the most recognizable names on Wall Street of late. It was founded in 1985 and is headquartered in New York, New York.The company employs over 4,500 people, with additional offices across Asia, Europe, North America, and Central America.
The company operates its businesses through four segments: Private Equity, Real Estate, Hedge Fund Solutions, and Credit & Insurance. As of Sep 30, 2023, total AUM was $1.01 trillion and fee-earning AUM was $734.5 billion.
BX is valued at $77 billion and has a Forward PE of 28. The stock holds Zacks Style Scores of “F” in Momentum and Value. BX pays a dividend of 3%.
Q3 Earnings
The Blackstone Group reported Q3 EPS back in October, posting a 4% surprise to the downside. The quarter was affected by a slow-deal making environment that resulted in lower asset sales.
Management commentary was very cautious in tone, but this was before the recent market rally. While the atmosphere has changed over the last month, estimates are still drifting lower since the earnings report.
Estimates
Over the last 60 days, numbers for the current quarter have been taken down from $1.27 to $1.05, or 17%.
For the current year, analysts have lowered estimates by 7% over that same time frame.
Looking at the longer term, numbers are going lower as well. For next year, estimates have fallen from $5.92 to $5.32, or over 10%.
The stock sold off after earnings but has rallied over 25% since the October low. Market forces have helped financials and BX, but investors should be looking to take profits into this up move.
Technical Take
The stock has traded in a sideways pattern since early 2022. The trading range has seen support around the $75-80 levels and resistance between $110-120. With the stock at $112 as of this writing, investors should be looking to take chips off the table.
Better entries below the current price include the 50-day moving average at $103 and the 200-day currently resides at $95.50
In Summary
While the fundamental environment might be shifting in favor of Blackstone, analysts are not on board yet. Investors should be taking chips off the table and looking for fresh entries at lower prices.
For those interested in the space, a better option might be Blue Owl Capital (ODBC). The stock is a Zacks Rank #1 (Strong Buy) that is trading close to 2022 highs.