Key Takeaways
- • Wall Street expects Blackstone (BX) to report Q3 EPS of $1.26, a 17.1% year-over-year decline, with revenue projected to rise nearly 4% to $3.21B.
- • CFO Michael Chae told investors on the Q2 call that base management fee growth in Q3 should match Q2's year-over-year pace, with a return to double-digit base management fee growth expected in 2027.
- • Chae flagged a sequential deceleration in net realizations for Q3, while anticipating a robust Q4 and strong 2027 tied to capital markets activity and a considerably stronger IPO market.
- • Redemption requests in non-traded BDCs have broadly declined quarter-over-quarter, and the wealth channel is a key focus, with RBC citing the launch of Blackstone Private Markets Funds as strengthening its lead.
- • Real estate remains the main risk: opportunistic real estate funds fell 1.4% over the trailing twelve months and real estate fee-earning AUM dropped 3% year-over-year, per Seeking Alpha analyst Steven Fiorillo.
Summary
Blackstone is scheduled to announce third-quarter earnings on Thursday, with investors focused on its wealth channel, fee growth, and the trajectory of its real estate business. According to the preview, Wall Street expects the alternative asset manager to post EPS of $1.26, implying a 17.1% year-over-year decline, while revenue is forecast to rise nearly 4% to $3.21B for the quarter. Redemption requests in non-traded BDCs have broadly declined quarter-over-quarter, a development that analysts are watching closely alongside the firm's bench strength following senior departures in real estate and private equity.
On the Q2 earnings call, CFO Michael Chae said Blackstone continues to expect year-over-year base management fee growth in Q3 similar to Q2, with a return to double-digit base management fee growth in 2027. Chae cautioned about a sequential deceleration in net realizations in the third quarter but anticipated a robust fourth quarter and a strong 2027, linking the timing to capital markets activity and noting that the IPO market had strengthened considerably.
Analyst sentiment is mixed. RBC Capital Markets, Oppenheimer, and Evercore ISI rate BX Outperform, with price targets of $169, $164, and $134, respectively. RBC analyst Bart Dziarski argued the firm is strengthening its lead in the wealth channel with the launch of Blackstone Private Markets Funds and is well positioned to benefit from a real estate rebound. Seeking Alpha analyst Steven Fiorillo cited resilient fee-related earnings and $7.5B in accrued carry, but identified rates as the most pressing risk, noting that elevated long-dated yields continue to delay a real estate recovery. He cited that opportunistic real estate funds fell 1.4% over the TTM, real estate fee-earning AUM dropped 3% YoY, and base management fees in the segment are still shrinking due to harvesting in the BREP funds.
Seeking Alpha's Quant Rating places BX at Hold, with a score of 2.96 out of 5, including an A- for profitability, a B+ for growth, and a D for momentum. Shares have fallen more than 28% year to date, underperforming the S&P 500, which gained nearly 12.7% over the same period. Blackstone has beaten EPS estimates 88% of the time and revenue estimates 75% of the time over the last two years. However, over the last three months, EPS estimates have seen no upward revisions versus 13 downward moves, and revenue estimates have seen no upward revisions versus four downward revisions.
On the Q2 earnings call, CFO Michael Chae said Blackstone continues to expect year-over-year base management fee growth in Q3 similar to Q2, with a return to double-digit base management fee growth in 2027. Chae cautioned about a sequential deceleration in net realizations in the third quarter but anticipated a robust fourth quarter and a strong 2027, linking the timing to capital markets activity and noting that the IPO market had strengthened considerably.
Analyst sentiment is mixed. RBC Capital Markets, Oppenheimer, and Evercore ISI rate BX Outperform, with price targets of $169, $164, and $134, respectively. RBC analyst Bart Dziarski argued the firm is strengthening its lead in the wealth channel with the launch of Blackstone Private Markets Funds and is well positioned to benefit from a real estate rebound. Seeking Alpha analyst Steven Fiorillo cited resilient fee-related earnings and $7.5B in accrued carry, but identified rates as the most pressing risk, noting that elevated long-dated yields continue to delay a real estate recovery. He cited that opportunistic real estate funds fell 1.4% over the TTM, real estate fee-earning AUM dropped 3% YoY, and base management fees in the segment are still shrinking due to harvesting in the BREP funds.
Seeking Alpha's Quant Rating places BX at Hold, with a score of 2.96 out of 5, including an A- for profitability, a B+ for growth, and a D for momentum. Shares have fallen more than 28% year to date, underperforming the S&P 500, which gained nearly 12.7% over the same period. Blackstone has beaten EPS estimates 88% of the time and revenue estimates 75% of the time over the last two years. However, over the last three months, EPS estimates have seen no upward revisions versus 13 downward moves, and revenue estimates have seen no upward revisions versus four downward revisions.
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