Blackstone’s Shareholder Rewards, Realizations Could Rise in 2017
Blackstone Group (BX) stock has risen 16% over the past three months on improved performance across its subsegments, high growth in 4Q16, and rising holdings valuations.
In February 2017, 11 out of the 14 analysts covering BX rated it as a “buy” or a “strong buy.” Another three analysts rated it as a “hold.”
Blackstone’s (BX) valuation stands at 9.5x on a one-year forward earnings basis, while its peers are trading at an average of 9.1x.
Blackstone’s (BX) hedge funds generated 2.3% growth in its portfolio in 4Q16, as well as 6.7% growth over the past three quarters after its weak performance in 1Q16.
The Blackstone Group’s (BX) Credit division posted strong revenue growth to $258.6 million in 4Q16, compared to $22.7 million in 4Q15.
The Blackstone Group (BX) garnered realizations of $3.5 billion in 4Q16, reflecting a year-over-year rise in improved valuations.
The Blackstone Group (BX) has raised $16.9 billion toward its private equity offerings in 2016.
The Blackstone Group (BX), the world’s largest alternative asset manager, is expected to see earnings per share of $0.73 in 1Q17, compared to EPS of $0.68 in 4Q16 and $0.31 in 1Q16.
PNC Financial Services (PNC) is expanding its balance sheet on the back of new assets and expanding offerings.
PNC Financial Services (PNC) manages both diversified banking operations and financial services divisions.
PNC Financial’s non-interest income for 3Q16 rose $167 billion compared to 3Q15. Sequentially, the company’s income rose $8 million.
PNC Financial Services (PNC) engages in corporate, retail, and institutional banking. The diversified giant expanded its commercial lending to $138 billion in 3Q16.
PNC Financial Services (PNC) is expected to post earnings per share (or EPS) of $1.84 in 4Q16, lower than its EPS of $1.87 in 4Q15 and in line with its EPS in 2Q16.
In 4Q16, Blackstone Group (BX) and Apollo Global Management (APO) are expected to report EPS (earnings per share) of $0.62 and $0.41, respectively.
Alternatives have historically paid 40%–60% of their earnings in dividends. Their earnings have improved in recent quarters, and payouts have increased sequentially.
Blackstone’s stock has risen 8.7% over the past month. It’s fallen 3.8% over the past year, reflecting a rise in recent months due to improved operating performance.
Equities and broader markets rebounded in 2H16. The global economic outlook has now become relatively more stable for 2017.
Energy prices (USO) saw a 45% rise in 2016 as OPEC and Russia struggled through excess inventories and entered into an agreement for an output freeze.
The credit market saw distressed pricing in 2H15 on lower bond pricing, mainly due to oil prices (USO) and interest rates.
In 2016, alternative asset managers saw higher exits and investments on the back of improved liquidity. The trend is expected to continue in 2017.