What Investors Can Expect from Blackstone’s Equity
Blackstone’s equity has returned a compounded annual growth rate of 30% over the past five years. It has paid substantial dividends with a yield of 5%–7%.
On a price-to-distributable-earnings basis, the company is trading at a premium at 14x, the highest in the alternative asset manager class.
Blackstone’s private equity and real estate divisions have outperformed the index. In the past few years, they outperformed the S&P 500 Index (SPY) by 4%–8%.
Blackstone has dry powder of $46 billion, which reflects its strong access to capital.
The launch of innovative ideas at the right time can help Blackstone attract a good amount of new capital through its dedicated network.
Blackstone offloaded much of its exposure to oil prices in 2013 and 2014. Less than a quarter of the company’s energy exposure is impacted by oil prices.
The hedge fund market worldwide was weaker, but Blackstone has expanded its assets under management under the segment by 14% to $63.5 billion.
Blackstone has one of the most innovative real estate funds in the world. Its funds have outperformed compared to other real estate investment companies.
Blackstone (BX) generated revenues of $2.7 billion and economic income of $1.8 billion for the year, backed by strong performance of BCP V and BCP VI.
Blackstone’s alternative asset management focuses on private equity, real estate, hedge fund solutions, noninvestment grade credit, and more.
BB&T is more widely represented in ETFs focused on the banking sector. The SPDR S&P Bank ETF (KBE) has BB&T comprising ~1.6% of its portfolio.
BB&T’s loan and deposit growth is marginally below the industry average. Its ROE and price-to-book ratio are close to the peer average.
Dividend yield is a company’s annual dividend per share. It’s expressed as a percentage of its share price. Dividend yields are important if you want a regular stream of income.
BB&T’s net interest income decreased 4.3% in 2014. The decrease in net interest income reflects lower yields on new loans and securities.
Deposits are the cheapest funding source. Since deposits fund a major chunk of BB&T’s assets, the overall funding costs are low.
Time deposits and IRAs account for 15% of the bank’s total deposits. The cost of total deposits decreased to 0.25% in 4Q14—compared to 0.28% in 4Q13.
BB&T hasn’t acquired many banks since 2009. Completing the Bank of Kentucky and Susquehanna acquisitions might boost the bank’s loan growth.
BB&T’s Susquehanna acquisition will significantly expand BB&T’s Mid-Atlantic footprint. The deal is valued at ~$2.5 billion. It will close in the second half of 2015.
BB&T entered Texas in 2009 with the acquisition of Colonial BancGroup. BB&T is looking to expand its branch network in Texas.
Mergers and acquisitions played a major role in BB&T’s (BBT) growth over the years. The company completed 123 acquisitions in the past 15 years.
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