Downgrading Blackstone To Neutral Despite Ongoing Fundraising Super Cycle: JP Morgan Analyst Explains
Portfolio Pulse from Nabaparna Bhattacharya
JP Morgan analyst Kenneth B. Worthington has downgraded Blackstone Inc (BX) from Overweight to Neutral, while raising the price target to $111 from $102. Despite the downgrade, Worthington believes Blackstone remains a top-tier alternative asset manager, leveraging secular trends for better growth. He expects organic growth supported by perpetual fund growth, currently weighed down by a depressed sentiment for real estate investing. Blackstone's 2Q23 Distributable Earnings were in line with Street consensus, and its assets under management rose 6% Y/Y to $1.0 trillion. However, fee earning AUM declined slightly in the quarter, the first decline since 2Q18.
July 21, 2023 | 5:49 pm
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NEGATIVE IMPACT
Blackstone has been downgraded to Neutral from Overweight by JP Morgan, despite its strong performance and growth. The firm's assets under management have increased, but fee earning AUM saw a slight decline.
The downgrade by JP Morgan could potentially impact Blackstone's stock negatively in the short term. Despite the firm's strong performance and growth, the slight decline in fee earning AUM could be a concern for investors. The raised price target, however, indicates that the analyst still sees potential in the company.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100