Back to top

Image: Bigstock

If You Invested $1000 in Blackstone Group a Decade Ago, This is How Much It'd Be Worth Now

Read MoreHide Full Article

For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.

FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.

What if you'd invested in Blackstone Group (BX - Free Report) ten years ago? It may not have been easy to hold on to BX for all that time, but if you did, how much would your investment be worth today?

Blackstone Group's Business In-Depth

With that in mind, let's take a look at Blackstone Group's main business drivers.

Headquartered in New York, The Blackstone Group Inc. is an asset manager of alternative investments and a provider of financial advisory services. As of Mar 31, 2021, total assets under management (AUM) were $648.8 billion.

The company operates its businesses through four segments:

The Private Equity segment comprises management of private equity funds, collectively called the Blackstone Capital Partners (BCP) funds, along with energy and communications-related investments. Also, the segment includes Tactical Opportunities business, Strategic Partners Fund Solutions and Blackstone Total Alternatives Solution. As of Mar 31, 2021, segmental AUM was $211.8 billion.

The Real Estate segment primarily comprises management of real estate funds called the Blackstone Real Estate Partners (BREP) funds. In addition, the segment has two other funds – Blackstone Real Estate Debt Strategies (BREDS) funds and Blackstone Property Partners (BPP) funds. As of Mar 31, 2021, segmental AUM was $196.3 billion.

The Hedge Fund Solutions segment consists of Blackstone Alternative Asset Management (BAAM), an institutional solutions provider utilizing hedge funds across a variety of strategies. The segment’s AUM was $81.8 billion as of Mar 31, 2021.

The Credit & Insurance segment includes senior credit-focused funds, distressed debt funds, mezzanine funds and general credit-focused funds concentrated in the leveraged finance marketplace. All these are managed by Blackstone’s subsidiary. As of Mar 31, 2021, segmental AUM was $158.9 billion.

In 2017, Blackstone acquired Aon's Technology-enabled HR Business and Harvest Fund Advisors LLC. In 2018, Blackstone, along with Canada Pension Plan Investment Board and GIC, acquired a majority stake in Thomson Reuters’ Financial & Risk business, and Clarus. In December 2020, the company acquired DCI.

Bottom Line

While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Blackstone Group ten years ago, you're probably feeling pretty good about your investment today.

According to our calculations, a $1000 investment made in May 2011 would be worth $8,709, or a gain of 770.90%, as of May 14, 2021, and this return includes dividends.

In comparison, the S&P 500 gained 269.27% and the price of gold went up 17.03% over the same time frame.

Going forward, analysts are expecting more upside for BX.

Shares of Blackstone have outperformed the industry over the past six months. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters. Its first quarter 2021 results reflected higher revenues and robust growth in assets under management (AUM) balance. Blackstone remains well-positioned to benefit from its fund-raising ability, revenue mix and inorganic growth efforts. The company’s buyout of DCI will likely further enhance its digital capabilities. However, elevated expenses (owing to higher general and administrative costs) might hurt the bottom line. Also, lower chances of sustainability of the company’s capital deployment activities, given the volatile nature of its earnings and high debt level, remains a major near-term concern. Yet, continued inflows are expected to aid the company's asset growth.

The stock has jumped 11.89% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 7 higher, for fiscal 2021; the consensus estimate has moved up as well.

We are reissuing this article to reflect an update to BX's 10-year gain. The original article, issued May 13, 2021, should no longer be relied upon.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Blackstone Inc. (BX) - free report >>

Published in