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Why BlackRock (BLK) Outpaced the Stock Market Today

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The latest trading session saw BlackRock (BLK - Free Report) ending at $781.08, denoting a +1.53% adjustment from its last day's close. This change outpaced the S&P 500's 0.77% gain on the day. Meanwhile, the Dow gained 0.49%, and the Nasdaq, a tech-heavy index, added 0.95%.

The investment firm's stock has dropped by 5.28% in the past month, falling short of the Finance sector's loss of 1.72% and the S&P 500's gain of 3.71%.

The upcoming earnings release of BlackRock will be of great interest to investors. In that report, analysts expect BlackRock to post earnings of $9.88 per share. This would mark year-over-year growth of 6.47%. In the meantime, our current consensus estimate forecasts the revenue to be $4.87 billion, indicating a 9.16% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates project earnings of $41.25 per share and a revenue of $20.2 billion, demonstrating changes of +9.21% and +13.11%, respectively, from the preceding year.

Any recent changes to analyst estimates for BlackRock should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.17% downward. BlackRock is currently a Zacks Rank #3 (Hold).

In the context of valuation, BlackRock is at present trading with a Forward P/E ratio of 18.65. This indicates a premium in contrast to its industry's Forward P/E of 10.16.

We can additionally observe that BLK currently boasts a PEG ratio of 1.59. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Financial - Investment Management industry stood at 0.93 at the close of the market yesterday.

The Financial - Investment Management industry is part of the Finance sector. At present, this industry carries a Zacks Industry Rank of 172, placing it within the bottom 32% of over 250 industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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