Blackstone Inc.

New York Stock Exchange
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Slightly Bullish +15

Blackstone (BX) Stock Seems Reasonable On A 30% One Year Fall

Company update AI-generated analysis

📉 Blackstone stock has fallen 29.7% over the past year, raising questions about whether the price drop matches the firm's return profile.

💰 The company raised $62 billion in inflows during Q1 2025, marking the highest level of capital deployment in three years.

📊 Financial modeling shows Blackstone with a book value of $11.27 per share and a stable EPS of $5.38.

🚀 The Excess Returns model calculates an average return on equity of 44.82% against a cost of equity of $0.97.

⚠️ A recent default on a $90 million Dallas apartment loan is cited as a factor preventing the market from pricing in a larger premium.

🏢 Pressure in the US multifamily real estate sector continues to influence Blackstone's current valuation relative to its capital efficiency.

📈 Community narratives suggest Blackstone is currently 17% undervalued based on fundamental data and historical performance.

Bullish Signals
  • Blackstone raised $62 billion in inflows in Q1 2025, marking the highest level of capital deployment in three years.
  • The Excess Returns model indicates an average return on equity of 44.82%, significantly exceeding the cost of equity.
  • Implied excess returns of $4.41 per share suggest the business is expected to earn meaningfully more on its capital than its financing costs over time.
Risk Factors
  • Blackstone recently defaulted on a $90 million Dallas apartment loan, contributing to market skepticism about valuation premiums.
  • Significant pressure in the US multifamily real estate sector is causing the market to discount Blackstone's modeled excess returns.
  • The stock has declined 29.7% over the past year, reflecting investor concerns regarding how effectively Blackstone can keep compounding its capital base amidst current challenges.
Full Analysis
Blackstone (BX) shares have declined approximately 29.7% over the past year, prompting an analysis of whether this valuation drop aligns with the firm's ability to generate returns on invested capital. The article evaluates Blackstone using an Excess Returns model, which assesses how productively the company turns its equity base into earnings above its financing costs. According to the financial modeling presented, Blackstone has a book value of $11.27 per share and a stable book value of $12.00 per share, with a stable EPS of $5.38. The model calculates an average return on equity of 44.82% against a cost of equity of $0.97, resulting in an implied excess return of $4.41 per share. These economic fundamentals suggest that Blackstone is expected to earn meaningfully more on its capital than its equity cost over time, with the estimated intrinsic value broadly aligning with the current share price of $118.42. However, market pressure in US multifamily real estate and a recent default on a $90 million Dallas apartment loan are cited as reasons why the market is not pricing in a larger premium to these modeled excess returns. Community narratives suggest Blackstone could be 17% undervalued, supported by Q1 2025 inflows of $62 billion, marking the highest level in three years. The article concludes that while the current valuation appears reasonable relative to capital efficiency metrics, specific real estate challenges continue to weigh on investor sentiment regarding future growth and margins.