BlackRock Shares Gain 12.6% in a Month: Is Now the Time to Buy BLK?

The stock markets continue to witness volatility due to tariff-related uncertainties and their impact on the economy. Despite massive volatility, BlackRock Inc. BLK, one of the leading global asset managers, has had a solid run on the bourses of late. In the past month, BLK shares have risen 12.6%, outperforming the S&P 500 index and the Zacks Finance sector but underperforming the industry. Additionally, the stock has underperformed its close peers — SEI Investments SEIC and Invesco Ltd. IVZ.One-Month BLK Price PerformanceImage Source: Zacks Investment ResearchGiven the uncertain and volatile backdrop, let us decipher whether BLK stock is worth betting on now.Major Factors That Support BlackRockStrategic Acquisitions: BlackRock has been expanding its footprint in domestic and global markets through acquisitions. In March 2025, it purchased Preqin, a premier independent provider of private markets data, for almost $3.2 billion in cash to enhance its private markets offerings.In October 2024, BLK acquired Global Infrastructure Partners to enhance its infrastructure offerings and origination capabilities. In May 2024, it completed the buyout of the remaining 75% stake in SpiderRock, solidifying its separately managed accounts offerings. Additionally, in December 2024, the company announced a deal to acquire HPS Investment for $12.1 billion to foray deeper into the private credit market.These buyouts reflect a strategic expansion of the company’s Aladdin technology business into the rapidly growing private markets data segment. In 2023, the company took over London-based Kreos Capital. Besides these, in the past, the company has acquired numerous firms across the globe, strengthening its presence and market share. Product Diversification to Boost AUM: BlackRock has been focusing on diversifying its product suite and revenue mix, which has been improving its assets under management (AUM) over the years. The company’s inorganic growth strategy also contributed to AUM's growth.AUM witnessed a five-year (2019-2024) compound annual growth rate (CAGR) of 9.2%. The uptrend continued during the first quarter of 2025. As of March 31, 2025, BlackRock’s total AUM was a record $11.58 trillion, with net inflows of $83 billion. Last year, the company witnessed record net inflows of $641 billion, including industry-leading exchange-traded funds (ETF) net inflows of $390 billion. The momentum will likely continue as efforts to strengthen the iShares unit (offering more than 1,400 ETFs globally) and ETF operations (it received approval for spot Bitcoin and ether ETFs in January 2024) and enhanced focus on the active equity business are likely to offer support.This February, Bloomberg reported that BlackRock plans to list an ETF product tied to Bitcoin in Europe. Last September, the company announced a collaboration with Partners Group to introduce a multi-private markets model solution, boosting retail investors’ accessibility to alternative investments.Such product diversification efforts are likely to bolster the company’s revenue mix, reduce revenue concentration risk, and allow it to serve a broader range of clients, aiding AUM growth. The company’s GAAP revenues witnessed a CAGR of 7% over the last five years ended 2024, with momentum persisting in the first quarter of 2025.Additionally, the combination of HPS Investment, Preqin and GIP data with BLK’s alternative asset management platform, eFront, will drive solid revenue growth in the quarters ahead.Sales EstimatesImage Source: Zacks Investment ResearchHowever, the uncertainties surrounding the impact of tariff policies and geopolitical risks are likely to exert pressure on BlackRock’s revenues in the near term.Impressive Capital Distributions: On the back of a solid balance sheet, BlackRock announced a 2% hike in the quarterly dividend to $5.21 per share in January 2025. BLK has increased its dividend five times in the last five years with an annualized dividend growth rate of 8.2%.Also, the company has a 46% dividend payout ratio, while its peers, SEI Investments and Invesco, have 21% and 45% payout ratios, respectively.Dividend YieldImage Source: Zacks Investment ResearchAlso, BlackRock has a share repurchase plan in place. In the first quarter of 2025, the company repurchased $375 worth of shares. It aims to buy back shares worth $1.5 billion this year.Bearish Analyst Sentiments for BLKOver the past month, the Zacks Consensus Estimate for 2025 and 2026 earnings of $45.21 and $50.86 has been revised 4.6% and 5.8% downward, respectively.Estimate Revision TrendImage Source: Zacks Investment ResearchThe projected figures imply growth of 3.7% and 12.5% for 2025 and 2026, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)How to Play BlackRock Stock NowIn terms of valuation, BLK’s price-to-book ratio (P/B) of 3.00X is lower than the industry's 3.58X. Thus, the stock is trading at a discount. This suggests that investors may be paying a lower price relative to the company's expected earnings growth.Price-to-Book Ratio TrendImage Source: Zacks Investment ResearchOn the other hand, SEI Investments has a P/B of 4.41X, which reflects that it is expensive compared with BLK, while Invesco's P/B of 0.57X indicates that it is trading at a discount.BlackRock is well-positioned to capitalize on acquisitions and expand its presence in the fast-growing private markets. The record AUM level and product diversification efforts are other tailwinds for the company. Moreover, lower valuation compared to the industry is another positive. Further, BlackRock’s growth initiatives have helped generate higher returns. This is demonstrated by the company’s return on equity (ROE) of 16.03% compared with the industry’s ROE of 12.53%.Return on Equity TrendImage Source: Zacks Investment ResearchHowever, a steady rise in expenses is a headwind. The company recorded a five-year CAGR of 7.4% (ended 2024), mainly due to higher general and administrative (G&A) costs. The uptrend continued in the first quarter of 2025. Overall costs are expected to remain elevated due to the company’s business expansion plans and persisting inflationary pressures. Management expects core G&A expenses in 2025 to increase in the mid to high-single-digit percentage range.Further, given rising geopolitical risks, foreign currency fluctuations and the global impact of tariff policies, BlackRock is likely to witness subdued overseas revenues, which will likely weigh on its growth. This is reflected in the bearish analyst sentiments amid weakening growth prospects.Thus, investors should watch out for these concerns and monitor how BlackRock integrates the acquisitions into its businesses and generates solid profits before making any investment decision. Those who already own the stock can sell it off to book profits.Currently, BLK carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BlackRock (BLK): Free Stock Analysis Report Invesco Ltd. (IVZ): Free Stock Analysis Report SEI Investments Company (SEIC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks