Today's winner : BlackStone Group LP (BX)
About the Company :
The Blackstone Group, L.P., together with its subsidiaries, provides alternative asset management and financial advisory services worldwide. The company operates in four segments: Private Equity, Real Estate, Credit and Marketable Alternatives, and Financial Advisory. The Private Equity segment involves in private equity investing through five general private equity funds and one specialized fund focusing on communications-related investments. This segment engages in various transactions comprising leveraged buyout acquisitions of companies, transactions involving start-up businesses in established industries, minority investments, corporate partnerships, distressed debt, structured securities, and industry consolidations. The Real Estate segment manages opportunistic real estate funds, internationally focused real estate funds, European focused real estate fund, and real estate debt investment funds. This segment invests in lodging, urban office buildings, and various real estate operating companies. The Credit and Marketable Alternatives segment engages in the management of funds of hedge funds, credit-oriented funds, CLO vehicles, and publicly-traded closed-end mutual funds. The Financial Advisory segment offers corporate, and mergers and acquisitions advisory services; restructuring and reorganization advisory services; and fund placement services for alternative investment funds. Blackstone Group Management L.L.C. operates as the general partner of the company. The Blackstone Group, L.P. was founded in 1985 and is headquartered in New York, New York.
Analysis
Blackstone has been one of the flagship companies in the Investment management space. In fact its one of the few companies which survived the financial crisis by being conservative on the derivatives and CDE based investments.
Here is the snapshot from recent Fourth quarter results
Economic Net Income (“ENI”) increased to $1.4 billion for the full year 2010, up 102% from
$703 million for the full year 2009. ENI increased to $513 million for the fourth quarter of 2010,
up 56% from $329 million for the fourth quarter of 2009.
Distributable Earnings were $702 million for the full year 2010, up 47% from $479 million in
2009; Distributable Earnings increased to $239 million for the fourth quarter of 2010, up 12%
from $213 million in the fourth quarter of 2009.
GAAP Results Attributable to The Blackstone Group L.P. improved in 2010 with a net loss of
$370 million, compared to a net loss of $715 million in 2009, in each case including net IPO and
acquisition-related charges. GAAP Net Loss Attributable to The Blackstone Group L.P. was
$11 million in the fourth quarter of 2010, compared to a net loss of $143 million in the fourth
quarter of 2009.
Fee-Earning Assets Under Management increased 14% to $109.5 billion at December 31, 2010,
from $96.1 billion at December 31, 2009 while Total Assets Under Management increased 30%
to $128 billion at December 31, 2010.
Blackstone declares a quarterly distribution of $0.32 per common unit which brings full year
distributions to $0.62 per common unit.
Lets see the valuation of the company versus future guidance..(as of 02/03/2011)
lets compare the valuation
Valuation versus the Index and Financial Group
You can see that its way undervalued compared to the financial industry as a whole.
These are recent events of significance that will boost the stock price increase
1, Possible New real estate fund.
2, Acquisition of Polymer Group.
3, M&A activities involving Sara Lee.
4, Last quarter earnings up by 180 % .(BX reported 4th qtr 2010 earnings of $0.46 per share on 2/3/11.)
Lets look at the Weekly chart
BX - Weekly Candlesticks: "
via StockCharts.com
"
The stock is on the upswing with high volume in last few trading sessions. I would see this trading above $20 in short time frame..
My target price for BX is $25 in next 3 months
Happy Investing.
Note : If you like this article and like to share it , please provide a direct link to the Blog using Facebook,Twitter and other media sharing links . Also please recommend to your friends.
About the Company :
The Blackstone Group, L.P., together with its subsidiaries, provides alternative asset management and financial advisory services worldwide. The company operates in four segments: Private Equity, Real Estate, Credit and Marketable Alternatives, and Financial Advisory. The Private Equity segment involves in private equity investing through five general private equity funds and one specialized fund focusing on communications-related investments. This segment engages in various transactions comprising leveraged buyout acquisitions of companies, transactions involving start-up businesses in established industries, minority investments, corporate partnerships, distressed debt, structured securities, and industry consolidations. The Real Estate segment manages opportunistic real estate funds, internationally focused real estate funds, European focused real estate fund, and real estate debt investment funds. This segment invests in lodging, urban office buildings, and various real estate operating companies. The Credit and Marketable Alternatives segment engages in the management of funds of hedge funds, credit-oriented funds, CLO vehicles, and publicly-traded closed-end mutual funds. The Financial Advisory segment offers corporate, and mergers and acquisitions advisory services; restructuring and reorganization advisory services; and fund placement services for alternative investment funds. Blackstone Group Management L.L.C. operates as the general partner of the company. The Blackstone Group, L.P. was founded in 1985 and is headquartered in New York, New York.
Analysis
Blackstone has been one of the flagship companies in the Investment management space. In fact its one of the few companies which survived the financial crisis by being conservative on the derivatives and CDE based investments.
Here is the snapshot from recent Fourth quarter results
Economic Net Income (“ENI”) increased to $1.4 billion for the full year 2010, up 102% from
$703 million for the full year 2009. ENI increased to $513 million for the fourth quarter of 2010,
up 56% from $329 million for the fourth quarter of 2009.
Distributable Earnings were $702 million for the full year 2010, up 47% from $479 million in
2009; Distributable Earnings increased to $239 million for the fourth quarter of 2010, up 12%
from $213 million in the fourth quarter of 2009.
GAAP Results Attributable to The Blackstone Group L.P. improved in 2010 with a net loss of
$370 million, compared to a net loss of $715 million in 2009, in each case including net IPO and
acquisition-related charges. GAAP Net Loss Attributable to The Blackstone Group L.P. was
$11 million in the fourth quarter of 2010, compared to a net loss of $143 million in the fourth
quarter of 2009.
Fee-Earning Assets Under Management increased 14% to $109.5 billion at December 31, 2010,
from $96.1 billion at December 31, 2009 while Total Assets Under Management increased 30%
to $128 billion at December 31, 2010.
Blackstone declares a quarterly distribution of $0.32 per common unit which brings full year
distributions to $0.62 per common unit.
Lets see the valuation of the company versus future guidance..(as of 02/03/2011)
| Market Cap (intraday) | 6.38B |
| Enterprise Value (Feb 3, 2011)3: | 11.76B |
| Trailing P/E (ttm, intraday): | N/A |
| Forward P/E (fye Dec 31, 2011)1: | 11.73 |
| PEG Ratio (5 yr expected)1: | 0.81 |
| Price/Sales (ttm): | 2.25 |
| Price/Book (mrq): | 1.49 |
| Enterprise Value/Revenue (ttm)3: | 4.32 |
lets compare the valuation
Valuation versus the Index and Financial Group
 |  P/E (TTM) | P/E (Fwd 12 Mo.) | |||
|---|---|---|---|---|---|
BX | 15.3x | 11.9x | 0.47x | 28.4% | -- |
Specialty Finance Industry | 16.6x | 16.2x | -1.13x | 8.1% | -12.4% |
Financials Sector | 17.8x | 23.4x | -0.4x | 31.0% | -2.9% |
S&P 500 | 19.3x | 17.2x | -0.19x | 22.6% | 10.3% |
You can see that its way undervalued compared to the financial industry as a whole.
These are recent events of significance that will boost the stock price increase
1, Possible New real estate fund.
2, Acquisition of Polymer Group.
3, M&A activities involving Sara Lee.
4, Last quarter earnings up by 180 % .(BX reported 4th qtr 2010 earnings of $0.46 per share on 2/3/11.)
Lets look at the Weekly chart
BX - Weekly Candlesticks: "
via StockCharts.com
"
The stock is on the upswing with high volume in last few trading sessions. I would see this trading above $20 in short time frame..
My target price for BX is $25 in next 3 months
Happy Investing.
Note : If you like this article and like to share it , please provide a direct link to the Blog using Facebook,Twitter and other media sharing links . Also please recommend to your friends.
I am long BX but I would like more of description here as to why you think the stock is undervalued. I believe the favorable interest rate environment boosts their real estate holdings and deal making. Their talent level seems extremely good in a very competitive business. They avoided the worst of the downturn and now seem to be in the driver's seat as they are mentioned in every big proposed deal.
ReplyDeleteRegards
My Analysis is based on the following obvious facts for Long term investment in BX.
ReplyDelete1, Less competition in the Investment management space due to death of some major ones during recession.
2, Current technical charts indicate a Breakout.
3, Goldman Sachs exiting some of the core business and BX will fill that space ..
in addition what is stated in my blog..