Why Wall Street Is Betting BIG on Blackstone (BX) Despite Market Chaos

Elizabeth

As traditional markets face volatility, Blackstone Inc. (NYSE: BX) continues to stand out as a leader in alternative investments—boasting resilient fees, steady growth, and a defensive market position. Here’s why analysts remain bullish on this $150B+ asset manager.

Blackstone’s Unshakable Market Position:
The rush toward private credit, real estate, and infrastructure has intensified, with even traditional managers like BlackRock and Vanguard expanding into alternatives. Yet, Blackstone’s brand power, decades of expertise, and sticky client relationships give it a durable edge:
✔ $1.1T+ in AUM (20% YoY growth in private credit)
✔ 10% YoY base fee growth in Q1 2025—defying industry-wide fee compression
✔ Performance fees dipped temporarily, but demand for alternatives remains strong

Macro Resilience: How BX Navigates Challenges

With slowing growth, Fed rate cuts, and tariff pressures, Blackstone’s diversified portfolio is built to weather storms:

1. Private Credit

• Floating-rate loans benefit from higher-for-longer rates.
• Default risks? Minimal—90% of BX’s credit book is senior secured.
• Banks retreating = opportunity: Private credit demand could double by 2026.

2. Real Estate

• Avoiding office spaces, focusing on industrial/logistics (e-commerce boom).
• $60B dry powder to capitalize on distressed assets.

3. Infrastructure

• Inflation-linked cash flows (energy, digital infrastructure) hedge macro risks.

Fee Power: The Hidden Strength

While passive ETFs race to zero fees, Blackstone’s performance-based model delivers premium margins:

• Base fees up 10% YoY (vs. flat growth for traditional asset managers).
• Performance fees cyclical but poised to rebound with market recovery.

Valuation: A Discounted Entry Point

• FRE multiple (Fee-Related Earnings) at 15x, below peers (KKR: 18x, Apollo: 20x).
• 2.72% dividend yield + buyback potential.
• Catalysts: Stronger fundraising, tariff-adjusted deal flow.

The Bottom Line

Buy Rating Reiterated
Blackstone’s moat in alternatives, fee resilience, and macro-agnostic strategies make it a long-term winner. Near-term headwinds are priced in—creating a compelling entry point.

Key Data Points

• Price Target: $145 (20% upside)
• Dividend Yield: 2.72%
• Q1 2025 Highlights: $1.09 distributable EPS, $479M net income