Is Blackstone Stock Overbought Amid Optimistic Narratives and Elevated Valuation Multiples?

The Blackstone Group (BX) has long been a bellwether for alternative asset management, but its current valuation metrics have sparked a contentious debate among investors. With a trailing price-to-earnings (P/E) ratio of 43.45 as of 2025-well above its 10-year average of 33.09 and the Financial Services sector average of 13.67-Blackstone's stock appears to trade at a premium to both its historical performance and industry peers according to analysis. Meanwhile, its EV/EBITDA ratio of 29.1, calculated using an enterprise value of $197.36 billion and TTM EBITDA of $6.66 billion, further underscores this premium according to valuation data. For contrarian investors, these metrics raise a critical question: Is Blackstone's stock overbought, or is the market merely pricing in a compelling narrative of future growth?

Valuation Multiples: A Tale of Two Narratives

Blackstone's P/E ratio of 43.45 places it 193% above the sector average, a gap that dwarfs its peers like Lazard (17.92) and Evercore (24.49), though it trails KKR's 52.4 according to market data. This divergence suggests that while Blackstone is not the most expensive in its peer group, its valuation remains significantly inflated relative to broader market benchmarks. The forward P/E of 24.69 and a PEG ratio of 1.12 imply that the stock is fairly valued if earnings growth expectations materialize according to financial analysis. However, these forward-looking metrics rely on assumptions about revenue and profit expansion that may not account for macroeconomic headwinds or sector-specific risks.

Historically, Blackstone's P/E has fluctuated wildly, peaking at 53.2 over a three-year period before retreating to its current level. This volatility highlights the stock's sensitivity to market sentiment. In 2025, optimism about Blackstone's diversification into credit markets and its resilience amid rising interest rates has driven multiples higher. Yet, as contrarian investors know, elevated valuations often precede corrections when growth expectations fail to meet reality.

Intrinsic Value: A Clash of Models

Discounted cash flow (DCF) analyses of Blackstone's intrinsic value yield conflicting results, underscoring the subjectivity of valuation models. A DCF (Growth Exit 5Y) model estimates intrinsic value at $114.26, suggesting the stock is overvalued at its 2025 market price of $176.94. Conversely, a base case DCF model calculates intrinsic value at $167.57, implying a 10% undervaluation. The Excess Returns Model, however, paints an even grimmer picture, pegging intrinsic value at $52.13-a 178% overvaluation.

These discrepancies reflect divergent assumptions about Blackstone's growth trajectory, discount rates, and risk profiles. For contrarians, the wide range of outcomes signals caution: if the market is pricing in aggressive growth scenarios, any shortfall-even a modest one-could trigger a sharp repricing.

Technical Indicators: Mixed Signals for Contrarians

Blackstone's technical indicators add another layer of complexity. As of November 2025, its 14-Day RSI stood at 33.613, signaling a "Sell" position. This reading, coupled with the RSI's exit from the oversold zone on November 7 (at 40.88) and a stock price of $145.94, suggests short-term bearish momentum. However, by December 13, the RSI had risen to 53.21, indicating a neutral stance.

While the RSI does not currently suggest overbought conditions (traditionally defined as above 70), the mixed signals-ranging from sell to neutral-highlight the stock's volatility. A sell rating for the day in late 2025 contrasts with a 1-month buy signal, illustrating the tug-of-war between short-term pessimism and longer-term optimism. For contrarians, this volatility may represent an opportunity to capitalize on overreactions, but it also underscores the risks of timing the market.

Contrarian Take: Caution Amid Optimism

Blackstone's current valuation metrics and technical indicators present a paradox: the stock appears overvalued by historical and sector standards, yet technical indicators suggest it is not yet overbought. This duality reflects a market that is pricing in aggressive growth assumptions while remaining hesitant to commit to them.

For contrarian investors, the key question is whether Blackstone's elevated multiples are justified by its fundamentals. While its forward P/E and PEG ratio suggest some alignment with growth expectations, the DCF model's wide variance and the RSI's bearish signals argue for prudence. If macroeconomic conditions deteriorate or Blackstone's earnings growth falters, the stock could face significant downward pressure.

In conclusion, Blackstone's stock is not yet overbought in a technical sense, but its valuation multiples are stretched relative to historical and sector benchmarks. Investors who dismiss the contrarian case risk being caught off guard by a correction, particularly if growth expectations prove unattainable. As always, diversification and disciplined risk management remain paramount in navigating such a high-conviction, high-risk proposition.