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Category: BlackRock (BLK)
Last updated: 25 June 2020 Stock price of BlackRock: $538.37 On this page we will look to provide more information and interesting details not often covered by mainstream financial websites of BlackRock, one of the largest financial services providers in the world, with assets under management topping $7 billion in the first quarter of their 2020 fiscal year.
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- With approximately 16,200 employees in more than 30 countries who serve clients in over 100 countries across the globe, BlackRock provides a broad range of investment and technology services to institutional and retail clients worldwide "
About BlackRock (BLK)
BlackRock, Inc. (together, with its subsidiaries, unless the context otherwise indicates, “BlackRock” or the “Company”) is a leading publicly traded investment management firm with $7.43 trillion of assets under management (“AUM”) at December 31, 2019. With approximately 16,200 employees in more than 30 countries who serve clients in over 100 countries across the globe, BlackRock provides a broad range of investment and technology services to institutional and retail clients worldwide. Our diverse platform of alpha-seeking active, index and cash management investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Products are offered directly and through intermediaries in a variety of vehicles, including open-end and closed-end mutual funds, iShares® exchange-traded funds (“ETFs”), separate accounts, collective investment trusts and other pooled investment vehicles.
BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin®, Aladdin Wealth, eFront, Cachematrix and FutureAdvisor, as well as advisory services and solutions to a broad base of institutional and wealth management clients. The Company is highly regulated and manages its clients’ assets as a fiduciary. We do not engage in proprietary trading activities that could conflict with the interests of our clients. BlackRock serves a diverse mix of institutional and retail clients across the globe. Clients include tax-exempt institutions, such as defined benefit and defined contribution pension plans, charities, foundations and endowments; official institutions, such as central banks, sovereign wealth funds, supranationals and other government entities; taxable institutions, including insurance companies, financial institutions, corporations and third-party fund sponsors, and retail investors.
BlackRock maintains a significant global sales and marketing presence that is focused on establishing and maintaining retail and institutional investment management and technology service relationships by marketing its services to investors directly and through third-party distribution relationships, including financial professionals and pension consultants. BlackRock is an independent, publicly traded company, with no single majority shareholder and over two-thirds of its Board of Directors consisting of independent directors. At December 31, 2019, The PNC Financial Services Group, Inc. (“PNC”) held 22.0% of BlackRock’s voting common stock and 22.4% of BlackRock’s capital stock, which includes outstanding common and nonvoting preferred stock
BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin®, Aladdin Wealth, eFront, Cachematrix and FutureAdvisor, as well as advisory services and solutions to a broad base of institutional and wealth management clients. The Company is highly regulated and manages its clients’ assets as a fiduciary. We do not engage in proprietary trading activities that could conflict with the interests of our clients. BlackRock serves a diverse mix of institutional and retail clients across the globe. Clients include tax-exempt institutions, such as defined benefit and defined contribution pension plans, charities, foundations and endowments; official institutions, such as central banks, sovereign wealth funds, supranationals and other government entities; taxable institutions, including insurance companies, financial institutions, corporations and third-party fund sponsors, and retail investors.
BlackRock maintains a significant global sales and marketing presence that is focused on establishing and maintaining retail and institutional investment management and technology service relationships by marketing its services to investors directly and through third-party distribution relationships, including financial professionals and pension consultants. BlackRock is an independent, publicly traded company, with no single majority shareholder and over two-thirds of its Board of Directors consisting of independent directors. At December 31, 2019, The PNC Financial Services Group, Inc. (“PNC”) held 22.0% of BlackRock’s voting common stock and 22.4% of BlackRock’s capital stock, which includes outstanding common and nonvoting preferred stock
Quick facts about BlackRock (BLK)
- BlackRock is listed on the NYSE under share code ticker: BLK
- Yum Brands market capital: $83.1 billion (as at 25 June 2020)
- Number of employees of BlackRock: 16 200
- Revenues in 2019: $14.539billion
- Earnings per share in 2019: $28.48
- PE ratio of BlackRock: 18.9
- Shares in issue: 158 million
- Dividends paid during 2019: $13.20
- Dividend yield: 2.6%
- Cash on balance sheet: $4.829 billion
- Stockholders equity in BlackRock: $34.92 billion
- Stockholders equity per share: $221
- Price/Stockholders equity ratio: 2.43
BlackRock client type
BlackRock serves a diverse mix of institutional and retail clients across the globe, with a regionally focused business model. BlackRock leverages the benefits of scale across global investment, risk and technology platforms while at the same time using local distribution presence to deliver solutions for clients. Furthermore, our structure facilitates strong teamwork globally across both functions and regions in order to enhance our ability to leverage best practices to serve our clients and continue to develop our talent. Clients include tax-exempt institutions, such as defined benefit and defined contribution pension plans, charities, foundations and endowments; official institutions, such as central banks, sovereign wealth funds, supranationals and other government entities; taxable institutions, including insurance companies, financial institutions, corporations and third-party fund sponsors, and retail investors.
Retail
BlackRock serves retail investors globally through a wide array of vehicles across the investment spectrum, including separate accounts, open-end and closed-end funds, unit trusts and private investment funds. Retail investors are served principally through intermediaries, including broker-dealers, banks, trust companies, insurance companies and independent financial advisors. Technology solutions, digital distribution tools and a shift toward portfolio construction are increasing the number of financial advisors and end-retail clients using BlackRock products. Retail represented 10% of long-term AUM at December 31, 2019 and 31% of long-term base fees for 2019. iShares ETFs have a significant retail component but is shown separately below. With the exclusion of iShares ETFs, retail AUM is predominantly comprised of active mutual funds. Mutual funds totaled $565.1 billion, or 80%, of retail long-term AUM at year-end, with the remainder invested in private investment funds and separately managed accounts. 87% of retail long-term AUM is invested in active product
iShares
ETFs iShares is the leading ETF provider in the world with $2.2 trillion of AUM at December 31, 2019 and was the top asset gatherer globally in 20191 with net inflows of $183.5 billion driving an organic growth rate of 11%. iShares fixed income net inflows of $112.4 billion were diversified across exposures and product lines, led by flows into Core, treasuries and mortgage-backed securities funds. iShares equity net inflows of $64.7 billion were driven by flows into Core funds and factor-based ETFs. iShares ETF multi-asset and alternative funds contributed a combined $6.4 billion of net inflows, primarily into commodities funds. iShares ETFs represented 33% of long-term AUM at December 31, 2019 and 41% of long-term base fees for 2019.
Our broad iShares ETF product range offers investors a precise, transparent and efficient way to gain exposure to a full range of asset classes and global markets that have been difficult for many investors to access, as well as the liquidity required to make adjustments to their exposures quickly and cost-efficiently
Institutional
BlackRock serves institutional investors on six continents in sub-categories including: pensions, endowments and foundations, official institutions, and financial institutions; institutional AUM is diversified across product and region. Institutional active AUM ended 2019 at $1.3 trillion, reflecting $99.5 billion of net inflows, positive across all asset classes. Fixed income net inflows of $55.0 billion included two sizable client wins in the second quarter of 2019. Multi-asset strategies saw continued growth, with net inflows of $28.8 billion reflecting ongoing demand for solutions offerings and the LifePath® target-date suite. Alternatives net inflows of $13.8 billion were led by inflows into infrastructure, private equity and real estate. Excluding return of capital and investment of $5.1 billion, alternatives net inflows were $18.9 billion. In addition, 2019 was another strong fundraising year for illiquid alternatives, and at year-end 2019 we had approximately $24 billion of committed capital to deploy for institutional clients. In total, Institutional active represented 19% of long-term AUM and 19% of long-term base fees
Multi-Asset
BlackRock’s multi-asset team manages a variety of balanced funds and bespoke mandates for a diversified client base that leverages our broad investment expertise in global equities, bonds, currencies and commodities, and our extensive risk management capabilities. Investment solutions might include a combination of long-only portfolios and alternative investments as well as tactical asset allocation overlays.
Alternatives
BlackRock alternatives focus on sourcing and managing high-alpha investments with lower correlation to public markets and developing a holistic approach to address client needs in alternatives investing. Our alternatives products fall into three main categories —
Illiquid alternatives include offerings in alternative solutions, private equity, opportunistic and credit, real estate and infrastructure. Liquid alternatives include offerings in direct hedge funds and hedge fund solutions (funds of funds). In 2019, alternatives generated $24.8 billion of net inflows, or $30.8 billion excluding return of capital/ investment of $6.0 billion. The largest contributors to return of capital/investment were private equity solutions, opportunistic and credit strategies, real estate and infrastructure. Net inflows were driven by infrastructure, direct hedge funds, real estate, and private equity and opportunistic strategies. At year-end, we had approximately $24 billion of non-fee paying, unfunded, uninvested commitments, which are expected to be deployed in future years; these commitments are not included in AUM or flows until they are fee-paying. We believe that as alternatives become more conventional and investors adapt their asset allocation strategies, investors will further increase their use of alternative investments to complement core holdings. Our highly diversified alternatives franchise is well positioned to meet growing demand from both institutional and retail investors.
Retail
BlackRock serves retail investors globally through a wide array of vehicles across the investment spectrum, including separate accounts, open-end and closed-end funds, unit trusts and private investment funds. Retail investors are served principally through intermediaries, including broker-dealers, banks, trust companies, insurance companies and independent financial advisors. Technology solutions, digital distribution tools and a shift toward portfolio construction are increasing the number of financial advisors and end-retail clients using BlackRock products. Retail represented 10% of long-term AUM at December 31, 2019 and 31% of long-term base fees for 2019. iShares ETFs have a significant retail component but is shown separately below. With the exclusion of iShares ETFs, retail AUM is predominantly comprised of active mutual funds. Mutual funds totaled $565.1 billion, or 80%, of retail long-term AUM at year-end, with the remainder invested in private investment funds and separately managed accounts. 87% of retail long-term AUM is invested in active product
iShares
ETFs iShares is the leading ETF provider in the world with $2.2 trillion of AUM at December 31, 2019 and was the top asset gatherer globally in 20191 with net inflows of $183.5 billion driving an organic growth rate of 11%. iShares fixed income net inflows of $112.4 billion were diversified across exposures and product lines, led by flows into Core, treasuries and mortgage-backed securities funds. iShares equity net inflows of $64.7 billion were driven by flows into Core funds and factor-based ETFs. iShares ETF multi-asset and alternative funds contributed a combined $6.4 billion of net inflows, primarily into commodities funds. iShares ETFs represented 33% of long-term AUM at December 31, 2019 and 41% of long-term base fees for 2019.
Our broad iShares ETF product range offers investors a precise, transparent and efficient way to gain exposure to a full range of asset classes and global markets that have been difficult for many investors to access, as well as the liquidity required to make adjustments to their exposures quickly and cost-efficiently
Institutional
BlackRock serves institutional investors on six continents in sub-categories including: pensions, endowments and foundations, official institutions, and financial institutions; institutional AUM is diversified across product and region. Institutional active AUM ended 2019 at $1.3 trillion, reflecting $99.5 billion of net inflows, positive across all asset classes. Fixed income net inflows of $55.0 billion included two sizable client wins in the second quarter of 2019. Multi-asset strategies saw continued growth, with net inflows of $28.8 billion reflecting ongoing demand for solutions offerings and the LifePath® target-date suite. Alternatives net inflows of $13.8 billion were led by inflows into infrastructure, private equity and real estate. Excluding return of capital and investment of $5.1 billion, alternatives net inflows were $18.9 billion. In addition, 2019 was another strong fundraising year for illiquid alternatives, and at year-end 2019 we had approximately $24 billion of committed capital to deploy for institutional clients. In total, Institutional active represented 19% of long-term AUM and 19% of long-term base fees
Multi-Asset
BlackRock’s multi-asset team manages a variety of balanced funds and bespoke mandates for a diversified client base that leverages our broad investment expertise in global equities, bonds, currencies and commodities, and our extensive risk management capabilities. Investment solutions might include a combination of long-only portfolios and alternative investments as well as tactical asset allocation overlays.
Alternatives
BlackRock alternatives focus on sourcing and managing high-alpha investments with lower correlation to public markets and developing a holistic approach to address client needs in alternatives investing. Our alternatives products fall into three main categories —
- illiquid alternatives,
- liquid alternatives, and
- currency and commodities.
Illiquid alternatives include offerings in alternative solutions, private equity, opportunistic and credit, real estate and infrastructure. Liquid alternatives include offerings in direct hedge funds and hedge fund solutions (funds of funds). In 2019, alternatives generated $24.8 billion of net inflows, or $30.8 billion excluding return of capital/ investment of $6.0 billion. The largest contributors to return of capital/investment were private equity solutions, opportunistic and credit strategies, real estate and infrastructure. Net inflows were driven by infrastructure, direct hedge funds, real estate, and private equity and opportunistic strategies. At year-end, we had approximately $24 billion of non-fee paying, unfunded, uninvested commitments, which are expected to be deployed in future years; these commitments are not included in AUM or flows until they are fee-paying. We believe that as alternatives become more conventional and investors adapt their asset allocation strategies, investors will further increase their use of alternative investments to complement core holdings. Our highly diversified alternatives franchise is well positioned to meet growing demand from both institutional and retail investors.
Client region
Our footprints in the Americas, EMEA and Asia-Pacific regions reflect strong relationships with intermediaries and an established ability to deliver our global investment expertise in funds and other products tailored to local regulations and requirements.
Americas
Net inflows of $280.1 billion were positive across all asset classes, with net inflows into fixed income, cash, equity, multi-asset and alternatives of $168.0 billion, $62.4 billion, $21.1 billion, $15.2 and $13.4 billion, respectively. During the year, we served clients through offices in 32 states in the United States as well as Canada, Mexico, Brazil, Chile and Colombia.
EMEA
EMEA net inflows of $122.8 billion reflected net inflows into fixed income, cash, equity, alternatives and multiasset of $64.7 billion, $29.4 billion, $15.9 billion, $9.3 and $3.5 billion, respectively. Our offerings include fund families in the United Kingdom, the Netherlands, Luxembourg and Dublin and iShares ETFs listed on stock exchanges throughout Europe, as well as separate accounts and pooled investment products.
Asia-Pacific
Asia-Pacific net inflows of $25.9 billion were primarily due to fixed income net inflows of $30.9 billion, partially offset by equity net outflows of $8.6 billion. Clients in the AsiaPacific region are served through offices in Japan, Australia, Hong Kong, Singapore, Taiwan, Korea, China, and India.
Total Assets Under Management (AUM) per region as at end of December 2019 (in $ millions)
Americas
Net inflows of $280.1 billion were positive across all asset classes, with net inflows into fixed income, cash, equity, multi-asset and alternatives of $168.0 billion, $62.4 billion, $21.1 billion, $15.2 and $13.4 billion, respectively. During the year, we served clients through offices in 32 states in the United States as well as Canada, Mexico, Brazil, Chile and Colombia.
EMEA
EMEA net inflows of $122.8 billion reflected net inflows into fixed income, cash, equity, alternatives and multiasset of $64.7 billion, $29.4 billion, $15.9 billion, $9.3 and $3.5 billion, respectively. Our offerings include fund families in the United Kingdom, the Netherlands, Luxembourg and Dublin and iShares ETFs listed on stock exchanges throughout Europe, as well as separate accounts and pooled investment products.
Asia-Pacific
Asia-Pacific net inflows of $25.9 billion were primarily due to fixed income net inflows of $30.9 billion, partially offset by equity net outflows of $8.6 billion. Clients in the AsiaPacific region are served through offices in Japan, Australia, Hong Kong, Singapore, Taiwan, Korea, China, and India.
Total Assets Under Management (AUM) per region as at end of December 2019 (in $ millions)
- Americas: $4,910,954
- EMEA $2,001,917
- Asia-Pacific: $516,762
- Total : $7,429,633
Technology services of BlackRock
BlackRock offers investment management technology systems, risk management services, wealth management and digital distribution tools on a fee basis. Aladdin is our proprietary technology platform, which serves as the investment and risk management system for both BlackRock and a growing number of institutional investors around the world. BlackRock offers risk reporting capabilities via the Aladdin Risk offering, as well as investment accounting capabilities. Aladdin Provider is a tool used by BlackRock’s custodial partners, connecting them to the platform to add operational efficiency. BlackRock also offers a number of wealth management technology tools offering digital advice, portfolio construction capabilities and risk analytics for retail distributors. These tools include Aladdin Wealth, which provides wealth management firms and their financial professionals with institutional-quality business management, portfolio construction, modeling and risk analytics capabilities, FutureAdvisor, a digital wealth management platform that provides financial institutions with technology-enabled investment advisory capabilities to manage their clients’ investments, and Cachematrix, a leading provider of financial technology which simplifies the cash management process for banks and their corporate clients in a streamlined, open-architecture platform. In 2019, BlackRock completed the acquisition of eFront, a leading end-to-end alternative investment management software and solutions provider. eFront will continue to be offered on a standalone basis, and, in combination with Aladdin, will provide clients with an ability to manage portfolios and risk across public and private asset classes on a single platform.
Technology services revenue of $974 million was up 24% year-over-year, reflecting the impact of the eFront acquisition and continued growth in Aladdin. Aladdin, which represented the majority of technology services revenue for the year, continues to benefit from trends favoring global investment platform consolidation and multi-asset risk solutions. Aladdin assignments are typically long-term contracts that provide recurring revenue. At year-end, BlackRock technology services clients included banks, insurance companies, official institutions, pension funds, asset managers, asset servicers, retail distributors and other investors across North America, South America, Europe, Asia and Australia. In addition, BlackRock has made minority investments in the digital distribution companies Scalable Capital and iCapital, Acorns, a micro-investing tool, and Envestnet, a leading independent provider of technology-enabled, web-based investment solutions and services to financial advisors. BlackRock records its share of income related to minority investments accounted for under the equity method in other revenue. BlackRock records gains and losses related to changes in value of other minority investments in nonoperating income (expense).
Technology services revenue of $974 million was up 24% year-over-year, reflecting the impact of the eFront acquisition and continued growth in Aladdin. Aladdin, which represented the majority of technology services revenue for the year, continues to benefit from trends favoring global investment platform consolidation and multi-asset risk solutions. Aladdin assignments are typically long-term contracts that provide recurring revenue. At year-end, BlackRock technology services clients included banks, insurance companies, official institutions, pension funds, asset managers, asset servicers, retail distributors and other investors across North America, South America, Europe, Asia and Australia. In addition, BlackRock has made minority investments in the digital distribution companies Scalable Capital and iCapital, Acorns, a micro-investing tool, and Envestnet, a leading independent provider of technology-enabled, web-based investment solutions and services to financial advisors. BlackRock records its share of income related to minority investments accounted for under the equity method in other revenue. BlackRock records gains and losses related to changes in value of other minority investments in nonoperating income (expense).
Employees of BlackRock
At December 31, 2019, BlackRock had a total of approximately 16,200 employees, including approximately 8,600 located in offices outside the United States.
Business Outlook of BlackRock (BLK)
BlackRock’s framework for long-term value creation is predicated on generating differentiated organic growth, leveraging scale to increase operating margins over time, and returning capital to shareholders on a consistent basis. BlackRock’s diversified platform, in terms of style, product, client and geography, enables it to generate more stable cash flows through market cycles, positioning BlackRock to invest for the long-term by striking an appropriate balance between investing for future growth and prudent discretionary expense management. BlackRock’s investment management revenue is primarily comprised of fees earned as a percentage of AUM and, in some cases, performance fees, which are normally expressed as a percentage of fund returns to the client. Numerous factors, including price movements in the equity, debt or currency markets, or in the price of real assets, commodities or alternative investments in which BlackRock invests on behalf of clients, could impact BlackRock’s AUM, revenue and earnings.
BlackRock manages $3.8 trillion of equity assets across markets globally. Beta divergence between equity markets, where certain markets perform differently than others, may lead to an increase in the proportion of BlackRock AUM weighted toward lower fee equity products, resulting in a decline in BlackRock’s effective fee rate. Divergent market factors may also erode the correlation between the growth rates of AUM and base fees. BlackRock’s highly diversified multi-product platform was created to meet client needs in all market environments. BlackRock is positioned to provide alpha-seeking active, index and cash management investment strategies across asset classes and geographies. In addition, BlackRock leverages its world-class risk management, analytics and technology capabilities, including the Aladdin platform, on behalf of clients.
BlackRock serves a diverse mix of institutional and retail clients across the globe, including investors in iShares ETFs, maintaining differentiated client relationships and a fiduciary focus. The diversity of BlackRock’s platform facilitates the generation of organic growth in various market environments, and as client preferences evolve. Client demand continues for ETFs and illiquid alternatives, which are two areas of focus for BlackRock. The index investing industry has been growing rapidly – with ETFs as a major beneficiary – driven by structural tailwinds including the migration from commission-based to fee-based wealth management, clients’ focus on value for money, the use of ETFs as alpha tools and the growth of all-to-all networked trading. iShares ETFs’ growth strategy is centered on increasing scale and pursuing global growth themes in client and product segments, including Core, Strategic, which includes Fixed Income, Factors, Sustainable and Megatrends ETFs, and Precision Exposures. As the wealth management landscape shifts globally from individual product selection to a whole-portfolio approach, BlackRock’s retail strategy is focused on creating outcome-oriented client solutions. This includes having a diverse platform of alpha-seeking active, index and alternative products, as well as enhanced distribution and portfolio construction technology offerings. Digital wealth tools are an important component of BlackRock’s retail strategy, as BlackRock scales and customizes model portfolios, extends Aladdin Wealth and digital wealth partnerships globally, and helps advisors build better portfolios through portfolio construction and risk management, powered by Aladdin. BlackRock continues to invest in technology services offerings, which enhance the ability to manage portfolios and risk, effectively serve clients and operate efficiently. Anticipated industry consolidation and regulatory requirements should continue to drive demand for holistic and flexible technology solutions.
In 2019, BlackRock completed the acquisition of eFront, a leading end-to-end alternative investment management software and solutions provider. eFront, in combination with Aladdin, will provide clients with an ability to manage portfolios and risk across public and private asset classes on a single platform. Across BlackRock, more clients are focusing on the impact of sustainability on their portfolios. This shift has been driven by an increased understanding of how sustainability-related factors can affect economic growth, asset values, and financial markets as a whole. As a fiduciary, BlackRock is committed to helping clients build more resilient portfolios. Since sustainable investment options have the potential to offer clients better outcomes, we are making sustainability integral to the way BlackRock manages risk, constructs portfolios, designs products, and engages with companies. Over the past several years, BlackRock has been deepening the integration of sustainability into technology, risk management, and product choice across BlackRock, and plans to accelerate those efforts.
BlackRock manages $3.8 trillion of equity assets across markets globally. Beta divergence between equity markets, where certain markets perform differently than others, may lead to an increase in the proportion of BlackRock AUM weighted toward lower fee equity products, resulting in a decline in BlackRock’s effective fee rate. Divergent market factors may also erode the correlation between the growth rates of AUM and base fees. BlackRock’s highly diversified multi-product platform was created to meet client needs in all market environments. BlackRock is positioned to provide alpha-seeking active, index and cash management investment strategies across asset classes and geographies. In addition, BlackRock leverages its world-class risk management, analytics and technology capabilities, including the Aladdin platform, on behalf of clients.
BlackRock serves a diverse mix of institutional and retail clients across the globe, including investors in iShares ETFs, maintaining differentiated client relationships and a fiduciary focus. The diversity of BlackRock’s platform facilitates the generation of organic growth in various market environments, and as client preferences evolve. Client demand continues for ETFs and illiquid alternatives, which are two areas of focus for BlackRock. The index investing industry has been growing rapidly – with ETFs as a major beneficiary – driven by structural tailwinds including the migration from commission-based to fee-based wealth management, clients’ focus on value for money, the use of ETFs as alpha tools and the growth of all-to-all networked trading. iShares ETFs’ growth strategy is centered on increasing scale and pursuing global growth themes in client and product segments, including Core, Strategic, which includes Fixed Income, Factors, Sustainable and Megatrends ETFs, and Precision Exposures. As the wealth management landscape shifts globally from individual product selection to a whole-portfolio approach, BlackRock’s retail strategy is focused on creating outcome-oriented client solutions. This includes having a diverse platform of alpha-seeking active, index and alternative products, as well as enhanced distribution and portfolio construction technology offerings. Digital wealth tools are an important component of BlackRock’s retail strategy, as BlackRock scales and customizes model portfolios, extends Aladdin Wealth and digital wealth partnerships globally, and helps advisors build better portfolios through portfolio construction and risk management, powered by Aladdin. BlackRock continues to invest in technology services offerings, which enhance the ability to manage portfolios and risk, effectively serve clients and operate efficiently. Anticipated industry consolidation and regulatory requirements should continue to drive demand for holistic and flexible technology solutions.
In 2019, BlackRock completed the acquisition of eFront, a leading end-to-end alternative investment management software and solutions provider. eFront, in combination with Aladdin, will provide clients with an ability to manage portfolios and risk across public and private asset classes on a single platform. Across BlackRock, more clients are focusing on the impact of sustainability on their portfolios. This shift has been driven by an increased understanding of how sustainability-related factors can affect economic growth, asset values, and financial markets as a whole. As a fiduciary, BlackRock is committed to helping clients build more resilient portfolios. Since sustainable investment options have the potential to offer clients better outcomes, we are making sustainability integral to the way BlackRock manages risk, constructs portfolios, designs products, and engages with companies. Over the past several years, BlackRock has been deepening the integration of sustainability into technology, risk management, and product choice across BlackRock, and plans to accelerate those efforts.
Competition of BlackRock
BlackRock competes with investment management firms, mutual fund complexes, insurance companies, banks, brokerage firms and other financial institutions that offer products that are similar to, or alternatives to, those offered by BlackRock. In order to grow its business, BlackRock must be able to compete effectively for AUM. Key competitive factors include investment performance track records, the efficient delivery of beta for index products, investment style and discipline, price, client service and brand name recognition. Historically, the Company has competed principally on the basis of its long-term investment performance track record, its investment process, its risk management and analytic capabilities and the quality of its client service.
Seasonality of BlackRock's earnings
Historically, securities lending revenue in the second quarter exceeds revenue in the other quarters during the year driven by higher seasonal demand
BlackRock (BLK) stock performance
BlackRock’s resilience is especially evident in times like these. Our stock price declined 14% since the beginning of the year, and although I am by no means happy with this performance, BlackRock is outperforming broader equity markets and the asset management industry. Our work is not done. Our strategy for growth is designed to withstand difficult periods such as this, and will carry us through this period. As the industry and investment landscape continue to change, we intend to be at the forefront of trends that will shape our ability to grow as a firm and deliver our clients the best possible set of outcomes
Our last BlackRock (BLK) stock valuation (17 April 2020)
So what is BlackRock stock worth based on the release of their latest earnings report? Based on BlackRock's latest earnings report provided our valuation model provides a target (full value) price at $459.90 a BlackRock stock (down slightly from our 4th quarter 2019 earnings report valuation of BlackRock). We therefore believe that the stock of BlackRock is overvalued.
We usually suggest long term fundamental or value investors look to enter into a stock at least 10% below our target (full value) price which in this case is $459.90 Therefore we see a good entry point into BlackRock's stock at $413.90 or below. We expect the stock of BlackRock to pull back in coming weeks and months to levels closer to our target price (full value price)
We usually suggest long term fundamental or value investors look to enter into a stock at least 10% below our target (full value) price which in this case is $459.90 Therefore we see a good entry point into BlackRock's stock at $413.90 or below. We expect the stock of BlackRock to pull back in coming weeks and months to levels closer to our target price (full value price)