Shares of sprawling alternative investment management company Blackstone (BX 4.80%) rose Monday on news of an analyst’s recommendation upgrade. The move pushed Blackstone’s stock price nearly 5% higher, a rate that was well above the 0.6% gain of the S&P 500 (^GSPC 0.64%) on the day.
Price weakness makes it a buy, says prognosticator
The upgrading party was Swiss bank UBS, in the person of analyst Brennan Hawken. The pundit lifted his Blackstone recommendation to buy from neutral Monday morning, with a price target of $180 per share. This anticipates upside of almost 22% on the stock’s current level.
According to reports, Hawken believes the recent and quite aggressive sell-off by the market was unjustified, and has left the shares valued quite attractively. He wrote that the company’s Blackstone Real Estate Investment Trust (BREIT) is a valuable asset that has unjustifiably attracted negative attention.
The company has been particularly active with its property operations lately. Earlier this month, it managed to raise $8 billion for its Real Estate Debt Strategies V fund, and will deploy those funds to investments not only in its native North America, but also Europe and Australia.
Unjustifiable punishment?
Over the years, Blackstone has grown into a wide-net financial services company, and its range is so broad it can be difficult to get a handle on the company at times. That being said, the recent sell-off seems a bit harsh, given there was no real crisis to justify such pessimism. With the shares currently trading at a relatively low level, perhaps this is indeed a good time to pile into the stock.
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Blackstone. The Motley Fool has a disclosure policy.
