Citigroup Reaffirms BlackRock Rating

Citigroup said that it is reaffirming its Hold rating on BlackRock, Inc. BLK. “We may reassess our view once the dust settles,” the company writes, “but $8B in shares still seems like a big amount, or about 25% of market cap assuming full exercise.” Citigroup said that it values shares of BlackRock using the Target P/E method. “Our $180 12- month target price is derived by applying a 15.5x multiple to our 2011 adjusted EPS estimate,” Citigroup writes. “The 15.5x multiple compares to 21x historically, based on our analysis. We believe slowing flow and EPS prospects plus negative consensus EPS revisions justify a lower target P/E, or in this case 15x-16x, which is more consistent with other high quality global managers.” BlackRock currently trades at $165.66.