BlackRock (BLK) Gains But Lags Market: What You Should Know

BlackRock (BLK) closed at $592.10 in the latest trading session, marking a +0.16% move from the prior day. This move lagged the S&P 500’s daily gain of 1.02%. Meanwhile, the Dow gained 0.3%, and the Nasdaq, a tech-heavy index, added 1.73%.

Coming into today, shares of the investment firm had gained 3.58% in the past month. In that same time, the Finance sector gained 3.95%, while the S&P 500 gained 7.25%.

Wall Street will be looking for positivity from BLK as it approaches its next earnings report date. On that day, BLK is projected to report earnings of $7.36 per share, which would represent year-over-year growth of 2.94%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.83 billion, up 3.69% from the year-ago period.

BLK’s full-year Zacks Consensus Estimates are calling for earnings of $29.45 per share and revenue of $15.17 billion. These results would represent year-over-year changes of +3.41% and +4.31%, respectively.

Any recent changes to analyst estimates for BLK should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.74% higher. BLK is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, BLK currently has a Forward P/E ratio of 20.07. For comparison, its industry has an average Forward P/E of 11.01, which means BLK is trading at a premium to the group.

Also, we should mention that BLK has a PEG ratio of 2.01. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. BLK’s industry had an average PEG ratio of 1.45 as of yesterday’s close.

The Financial – Investment Management industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 53, which puts it in the top 21% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Source: Nasdaq

Leave a Reply