Stock (Symbol) |
BlackRock (BLK) |
Stock Price |
$466 |
Sector |
| Financial |
Data is as of |
| November 12, 2017 |
Expected to Report |
| Jan 11 |
Company Description |
 BlackRock, Inc. (BlackRock) is an independent investment management firm. Its product range includes single- and multi-asset class portfolios investing in equities, fixed income, alternatives and/or money market instruments. Source: Thomson Financial |
Sharek’s Take |
 BlackRock (BLK) is perfectly positioned for today’s investments. The world continues to appreciate (and invest in) ETFs and Index funds, which are passive investments. So the company is seeing the marketplace and responding by overhauling its stock-picking business in an effort that has included layoffs, pricing changes and a greater emphasis on computer models that inform investments. This shift into computer modeling is lowering expenses and fees — which investors appreciate. BlackRock is the world’s largest asset manager. Half of assets under management are in stocks, with a qtr in bonds and the remainder in multi-assets, alternatives and cash. It has half the $600 billion in fixed income ETF market. In asset style, BlackRock assets are evenly divided between active management, index funds, and ETFs — which means 2/3rds of assets are passive investments with no money manager needed. The stock is doing excellent. BLK has an Estimated Long-Term Growth Rate of 15% per year in addition to yield close to 3% ($10 in dividends per year). Management is on track to buy back $1 billion in stock this year, which on an annualized basis is around 1.5% of BLK’s market cap. BlackRock is a safe, sound stock that’s capable of double-digit growth plus a nice yield. The company is paying $10 in annual dividends when it’s making around $20 in profits — those are big numbers. The only issue is the stock just shot up from $480 to $512 in the last week, so I would let it come back a little if I were to make an investment. My 2018 Fair Value is $559. |
One Year Chart |
 These charts were done last month when BLK was $466. It’s already up 10% since. Wow. Nice 15% profit growth last qtr, which blew past views 7% growth. That was a HUGE qtr. And that surprised investors, as the company missed estimates the prior 2 qtrs (as it restructured operations). Afterwards, qtrly and annual profit estimates all increased. This stock was a bargain here when this chart was made, I should have bought more shares. No wonder BLK has soared since. Qtrly profit growth Estimates are 16%, 22% , 16% and 9% for the next 4 qtrs. And that 9% qtr is likely too low as analysts didn’t plan on the big earnings beat last qtr (thus comparisons are tough). So it’s conceivable that BlackRock could grow profits 15% to 20% next year — which would be fantastic for such a big Financial. |
Fair Value |
 My Fair Value on BlackRock jumps this qtr from a P/E of 19 to a P/E of 22. The stock has great upside potential when you look at this table, but this was done when the stock was $466. It’s $512 now. Smokin. |
Bottom Line |
 BlackRock was a great stock more than a decade ago as it was delivering 20% profit and stock growth. Then it went through a back-and-forth period. Now the growth is back baby! And with investors continuing to throw money at index funds and ETFs the company should continue to have far reaching success for years to come. BLK ranks 5th of 32 stocks in the Conservative Growth Portfolio Power Rankings. I need to buy it in the Growth Portfolio, but will wait for a pullback or a basing pattern. |
Power Rankings |
Growth Stock Portfolio
N/AAggressive Growth Portfolio N/AConservative Stock Portfolio 5 of 32 |
