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The Blackstone Group: A Giant in Alternative Asset Management

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Assets under management

The Blackstone Group L.P. (BX) provides financial advisory services to clients around the globe. It manages almost $290 billion in assets as of December 31, 2014.  Blackstone’s alternative asset management includes investment vehicles focused on private equity, real estate, hedge fund solutions, fund of funds, noninvestment grade credit, and multi-asset class exposures outside of other funds’ mandates.

Blackstone also provides financial advisory services, including financial and strategic advisory services, restructuring and reorganizing advisory services, and capital markets and fund placement services.

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4Q14 results beat estimates

Blackstone’s economic net income declined by 6% in the last quarter of 2014. However, it managed to beat market estimates of its earnings per share. Blackstone reported a decline in revenues and overall profitability mainly due to its exposure in the energy sector.

Blackstone’s revenue for the quarter declined by 21% to $2.13 billion. However, the company saw a decent rise in its assets under management (or AUM) across its innovative offerings in the United States and Europe. For the last quarter, the AUM expanded by $19 billion.

For the full year, Blackstone’s performance was better than its peers in the alternative management space. Its peers include the Carlyle Group (CG), KKR & Co. L.P. (KKR), Apollo Global Management (APO), and T. Rowe Price (TROW). Its peers also include other major players that form part of the Financial Select Sector SPDR Fund (XLF) and the iShares U.S. Financials ETF (IYF).

Blackstone reported an increase in economic net income (or ENI) and distributable net income (or DE) of 24% and 64%, respectively.

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