How attractive is the BlackRock stock?

Last Updated: 22. Januar 2024By

The company BlackRock (WKN: 928193) is the largest asset manager and at the same time the most influential financial institution in the world. BlackRock is represented as a major shareholder in companies such as Bayer, BASF, Allianz, E.ON, and other large corporations. The asset manager is considered a shadow bank and is therefore not subject to the regulations of traditional banks. Because BlackRock is „too big to fail,“ the company can rely on support from governments in times of crisis.

BlackRock plays a major role in the financial world and as an interested investor, you may be wondering whether the BlackRock stock could be an interesting investment for you.

BlackRock, Source: Aktien Screener Investor Verlag The numbers surrounding BlackRock make it clear what league the company plays in. The presentation of the last quarterly figures showed that BlackRock currently manages around $10 trillion.

$120 billion market value, $18 billion revenue in 2023 BlackRock has a market value of $120 billion. The company has little debt and regularly pays out dividends. The dividend yield was recently 2.5 percent. Last year, revenue of $18 billion was generated. BlackRock earns around 80 percent of its revenue through fees.

The most important pillar in BlackRock’s business is ETFs. Of the $10 trillion, around 35 percent is invested in ETFs, and the share of revenue is even higher. Funds sold to private clients account for 10 percent of the assets and 30 percent of the fees, which are very high in this area. In addition, there are funds for institutional investors. The fees are significantly lower there. The share of assets is 50 percent, and fees account for „only“ 25 percent.

What plays an important role in the market value Investors who are considering investing in BlackRock stock should know that the company’s revenue is heavily dependent on the development of the rest of the stock market. If the stock market is in a downtrend, the assets in the funds decrease. As a result, BlackRock collects less fees. The same applies for the opposite. If the stock markets rise, both the assets and the fees increase.

In addition, BlackRock can grow when investors put fresh money into the funds, which has been the case in recent years. In general, the market for asset managers is highly fragmented. In fact, the five largest providers account for only 10 percent of total revenue, although larger providers are usually cheaper than smaller ones.

Solid performance? It is unlikely that the BlackRock stock will take off as a high flyer on the stock market, but it could well be that the company will grow faster than the overall market in the next few years.

It is definitely worth taking a look at the stock. You then decide whether the stock should be in your portfolio or not.

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