Investors Are Massively Looking For Blackstone Inc. (BX): Here’s What You Need To Know – October 26, 2022

Blackstone Inc. (Bx Free Report) has been one of the most searched stocks on Zacks.com lately. So, you might want to consider some of the facts that could shape the stock’s performance in the short term.

Shares of this investment manager have returned +11.7% over the past month compared to the +4.6% change in the Zacks S&P 500 composite. Industry Zacks Financial – Miscellaneous Services, to which Blackstone Inc belongs ., gained 4% during this period. Now the key question is: where could the stock be heading in the near term?

While press releases or rumors about a substantial change in a company’s trading outlook usually “trend” its stock and cause an immediate price change, there are always fundamental facts that ultimately dominate the take. purchase and retention decision.

Revisions to earnings estimates

At Zacks, we prioritize evaluating change in a company’s future earnings projection over anything else. This is because we believe that the present value of its future income stream is what determines the fair value of its stock.

Our analysis is primarily based on how sell-side analysts covering the stock revise their earnings estimates to reflect the latest trading trends. When a company’s earnings estimates increase, the fair value of its stock also increases. And when the fair value of a stock is higher than its current market price, investors tend to buy the stock, causing its price to rise. For this reason, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term movements in stock prices.

For the current quarter, Blackstone Inc. is expected to post earnings of $1.07 per share, indicating a -37.4% change from the prior year quarter. The Zacks consensus estimate has changed -6% in the last 30 days.

The current year earnings consensus estimate of $5.16 indicates a year-over-year change of +8.2%. This estimate has changed by -0.1% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $5.35 indicates a change of +3.7% from what Blackstone Inc. was expected to report a year ago. Over the past month, the estimate has changed by -5%.

have a strong externally audited balance sheet, our proprietary stock rating tool, Zacks Rank, provides a more conclusive picture of a stock’s price direction in the short term, as it effectively harnesses the power of earnings estimate revisions. Due to the magnitude of the recent consensus estimate change, as well as three other factors related to earnings estimatesBlackstone Inc. is ranked Zacks Rank #3 (Hold).

The chart below shows the evolution of the company’s consensus 12-month EPS estimate:

12 month EPS

Revenue Growth Forecasts

While a company’s earnings growth is arguably the best indicator of its financial health, nothing happens if it can’t grow its revenue. It is almost impossible for a company to increase its profits without increasing its revenue for long periods of time. Therefore, knowing the potential revenue growth of a business is crucial.

In the case of Blackstone Inc., the consensus sales estimate of $2.85 billion for the current quarter indicates a year-over-year change of -36%. Estimates of $13.13 billion and $13.61 billion for the current and next fiscal year indicate changes of +12.5% ​​and +3.7%, respectively.

Latest reported results and history of surprises

Blackstone Inc. reported revenue of $2.59 billion in the last reported quarter, representing a year-over-year change of -14.8%. EPS of $1.06 for the same period versus $1.28 a year ago.

Compared to the Zacks consensus estimate of $2.56 billion, reported revenue is a surprise of +1.36%. Surprise EPS was +10.42%.

The company has exceeded consensus EPS estimates in each of the past four quarters. The company has exceeded consensus earnings estimates every time during this period.

Evaluation

No investment decision can be effective without considering the valuation of a stock. Whether a stock’s current price accurately reflects the intrinsic value of the underlying business and the company’s growth prospects is a key determinant of its future price performance.

Compare the present value of a company’s valuation multiples, such as its price/earnings (P/E), price/sales (P/S), and price/cash flow (P/CF), to its own historical values ​​help determine whether its stock is fairly priced, overvalued or undervalued, while comparing the company against its peers on these metrics gives a good idea of ​​the reasonableness of its price.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to traditional and unconventional valuation metrics to rank stocks from A to F (an A is better than a B; a B is better than a C; and so on), is quite useful in determining whether a stock is overvalued, correctly priced, or temporarily undervalued.

Blackstone Inc. is rated C on this front, indicating that it trades at par with its peers. Click here to see the values ​​of some of the rating metrics that led to this rating.

Conclusion

The facts discussed here and plenty of other information about Zacks.com could help determine whether it’s worth paying attention to the market buzz about Blackstone Inc. However, its #3 Zacks ranking suggests it may work in line with the broader market of the short term.

Robert D. Coleman