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BlackRock (BLK) Up 4.4% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for BlackRock (BLK - Free Report) . Shares have added about 4.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is BlackRock due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
BlackRock’s second-quarter 2021 adjusted earnings of $10.03 per share outpaced the Zacks Consensus Estimate of $9.24. The figure reflects a rise of 27.8 % from the year-ago quarter’s number.
Results benefited from an improvement in revenues, partly offset by higher expenses. Moreover, long-term net inflows supported growth in AUM balance, which was a major positive.
Net income attributable to BlackRock (on a GAAP basis) was $1.38 billion, up 13.5% from the prior-year quarter.
Revenues & Expenses Increase
Revenues (on a GAAP basis) were $4.82 billion, increasing 32.1% year over year. The upside stemmed from an increase in almost all components of revenues, except for advisory and other revenues. The figure surpassed the Zacks Consensus Estimate of $4.68 billion.
Total expenses amounted to $2.89 billion, up 28.9% from the year-ago quarter. The rise was due to an increase in all cost components.
Non-operating income (on a GAAP basis) was $270 million, down 24.4% from the year-ago quarter.
BlackRock’s adjusted operating income was $1.93 billion, up 37.3% from the prior-year quarter.
Net Inflows Support AUM Growth
As of Jun 30, 2021, AUM totaled $9.50 trillion, reflecting a jump of 29.8% year over year. In the reported quarter, the company witnessed long-term net inflows of $60 billion.
Share Repurchase Update
BlackRock repurchased shares worth $300 million in the reported quarter.
Outlook
The company continues to expect discretionary money market fee waivers to persist around the current levels in the near term.
Adjusted operating margin in 2021 is anticipated to be in line with the 2020 figure.
Over the long term, the company expects low to mid-teens growth in annual contract value.
Projected tax run rate for 2021 is 24%.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, BlackRock has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, BlackRock has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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BlackRock (BLK) Up 4.4% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for BlackRock (BLK - Free Report) . Shares have added about 4.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is BlackRock due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
BlackRock Q2 Earnings Beat, Revenues & AUM Rise Y/Y
BlackRock’s second-quarter 2021 adjusted earnings of $10.03 per share outpaced the Zacks Consensus Estimate of $9.24. The figure reflects a rise of 27.8 % from the year-ago quarter’s number.
Results benefited from an improvement in revenues, partly offset by higher expenses. Moreover, long-term net inflows supported growth in AUM balance, which was a major positive.
Net income attributable to BlackRock (on a GAAP basis) was $1.38 billion, up 13.5% from the prior-year quarter.
Revenues & Expenses Increase
Revenues (on a GAAP basis) were $4.82 billion, increasing 32.1% year over year. The upside stemmed from an increase in almost all components of revenues, except for advisory and other revenues. The figure surpassed the Zacks Consensus Estimate of $4.68 billion.
Total expenses amounted to $2.89 billion, up 28.9% from the year-ago quarter. The rise was due to an increase in all cost components.
Non-operating income (on a GAAP basis) was $270 million, down 24.4% from the year-ago quarter.
BlackRock’s adjusted operating income was $1.93 billion, up 37.3% from the prior-year quarter.
Net Inflows Support AUM Growth
As of Jun 30, 2021, AUM totaled $9.50 trillion, reflecting a jump of 29.8% year over year. In the reported quarter, the company witnessed long-term net inflows of $60 billion.
Share Repurchase Update
BlackRock repurchased shares worth $300 million in the reported quarter.
Outlook
The company continues to expect discretionary money market fee waivers to persist around the current levels in the near term.
Adjusted operating margin in 2021 is anticipated to be in line with the 2020 figure.
Over the long term, the company expects low to mid-teens growth in annual contract value.
Projected tax run rate for 2021 is 24%.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
VGM Scores
At this time, BlackRock has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, BlackRock has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.