How BlackRock Is Positioned To Benefit From High-Interest Rate Environment And Outsourcing Shift: Analyst

Keefe, Bruyette & Woods analyst Michael Brown upgraded BlackRock Inc BLK to Outperform from Market Perform at an increased price target of $835 from $770.

The analyst is bullish on BLK's continued healthy organic growth and profitability and believes its diversified portfolio yields a better balance and margin resiliency than its peers. 

Brown thinks the high-interest rate environment is favorable for BLK and expects it to benefit from the impending surge of fixed-income inflows (both on the active and passive side).

In particular, the analyst sees BLK as well positioned to witness market share gain in the fixed-income market on continued secular growth of passives. 

Also, Brown believes BLK can benefit from the secular shift to outsourcing, given its strong outsourcing CIO capabilities and risk management technology.

Also, the analyst sees opportunities for international expansion in the wealth channel and enhancement of the private asset platform of the company.

Consequently, the analyst raised the EPS estimate for BLK to $35.38 (from $34.90, vs. consensus of $35.08) for 2023 and $41.63 (from $40.55, vs. consensus of $40.24) for 2024.

Also Read: BlackRock Assists Quintet Private Bank To Boost Their Investment Capabilities

Price Action: BLK shares are trading higher by 1.51% at $694.46 on the last check Monday.