Blackstone (BX) recently saw its stock rise 6.27% on October 17, continuing a six-day surge that totaled a 14.36% increase, with the price reaching a record high during trading.
The strong performance in Blackstone’s private equity and infrastructure funds was a significant factor, with the third-quarter results surpassing expectations. Distributable earnings for the quarter rose by 6% compared to the previous year, reaching $1.3 billion. Blackstone's asset management scale achieved a record high of $1.1 trillion.
During this quarter, Blackstone acquired Australian data operator AirTrunk for an enterprise value of $16 billion, marking the largest leveraged buyout of the year.
Credit and insurance were substantial contributors, with $21.4 billion in inflows, constituting over half of the firm's fundraising in the three-month period ending September 30. As a result, credit assets, amounting to $354.7 billion, have surpassed real estate as Blackstone's largest asset category.
This diversification strategy, as highlighted by President Jon Gray, positions Blackstone as a financial "supermarket," alleviating pressure in private equity amid market challenges.
The focus on credit underscores Blackstone's adaptability, especially critical when traditional sectors like private equity and real estate face hurdles. This shift also helped diminish potential setbacks from stagnant realizations in these areas, with private equity distributable earnings dropping 11% and real estate falling by 3%.
In real estate, pressures from a sluggish market and high debt costs remain, though redemption requests at the Blackstone Real Estate Income Trust (BREIT) decreased significantly this quarter.
Gray expressed optimism, stating, “We foresee a positive net flow trend for BREIT if current patterns persist.” He also noted an increasing confidence on Wall Street regarding market conditions.
Overall, Blackstone managed $250 billion in assets for individual and banking channels, and enjoyed notable inflows in corporate private equity and infrastructure sectors, reaching the highest fund valuation growth in three years.