On Feb 26, 2013, we reaffirmed our long-term recommendation on
) at Neutral. This reflects the company's strong fourth-quarter
results, which exceeded the Zacks Consensus Estimate by nearly
BlackRock's fourth-quarter adjusted earnings came in at $3.96 per
share, significantly surpassing the Zacks Consensus Estimate of
$3.74. Better-than-expected results were primarily driven by
augmented top line, partly offset by higher operating expenses.
Moreover, increased asset under management (AUM) was a positive.
Following the fourth-quarter results, the Zacks Consensus
Estimate for 2013 has gone up 3.3% to $15.47 per share. Likewise,
the Zacks Consensus Estimate for 2014 has also advanced (up 5.3%
to $17.63 per share). With the Zacks Consensus Estimates for both
2013 and 2014 increasing, the company now has a Zacks Rank #2
Moreover, BlackRock has been expanding primarily via acquisitions
- domestic and overseas - leading to growth in AUM. The company
has ample acquisition opportunities in the overseas markets like
Europe, Middle East, Africa and the Asia Pacific.
Yet, elevated operating expenses remain a major concern for
BlackRock. Though total operating expenses declined slightly on a
year-over-year basis in 2012, increased regulatory compliance
costs as well as higher marketing costs (related to the company's
new brand campaign) will keep the overall expenses high.
Other Investment Management Stocks Worth
While we prefer BlackRock, other financial investment management
stocks worth a look include
AllianceBernstein Holding L.P.
Virtus Investment Partners, Inc.
). All these carry a Zacks Rank #1 (Strong Buy).
ALLIANCEBERNSTN (AB): Free Stock Analysis
BLACKROCK INC (BLK): Free Stock Analysis
LAZARD LTD (LAZ): Free Stock Analysis Report
VIRTUS INVESTMT (VRTS): Free Stock Analysis
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