Blackstone (BX) has just been added to several Russell value benchmarks, including the Russell 1000 Value and Russell 3000 Value indices, which may put the stock on more institutional investors’ radar.

Short term, Blackstone’s share price return has picked up, with a 5.8% gain over the past week and 5.8% over 90 days, but the year to date share price return is down 24.7% and the 1 year total shareholder return is down 19.3%. The 3 and 5 year total shareholder returns of 41.2% and 43.4% point to a stronger longer term record as it enters multiple Russell value indices and continues to recycle capital through data center deals.

If Blackstone’s index addition has you thinking about where else capital is flowing, it can be useful to broaden your search and review the 20 top founder-led companies

So with Blackstone now sitting inside several Russell value indices, a recent pullback, a price near US$119.55 and a discount to the average analyst target, is there genuine value here, or is the market already pricing in the next leg of growth?

Most Popular Narrative: 16.7% Undervalued

Based on the most widely followed narrative, Blackstone's fair value of $143.45 sits above the last close of $119.55, which frames the current debate around how much future earnings strength is already reflected in the price.

The firm is well-positioned to benefit from market dislocation with $177 billion of dry powder available for opportunistic investments, potentially increasing future earnings as capital is deployed in undervalued assets.
The expansion in private credit, particularly in investment-grade private credit, shows a 35% year-over-year growth, indicating potential for significant revenue streams due to larger spreads and structural tailwinds in the credit markets.

Want to see what sits behind that fair value gap for Blackstone? The narrative leans on faster revenue momentum, much fatter margins, and a richer earnings base years from now. Curious how those ingredients combine into a single target price, and what discount rate is used to pull it all back to today? The full narrative breaks down every assumption that feeds this valuation blueprint.

Result: Fair Value of $143.45 (UNDERVALUED)

However, Blackstone's narrative also carries clear risks, including trade related shocks that could pressure real estate values and market volatility that may slow realizations and delay capital deployment.

Another View: Our DCF Model Paints a Different Picture

While the most popular Blackstone narrative points to a fair value of $143.45, the Simply Wall St DCF model points the other way, with an estimate of $111.72. On that basis, Blackstone at $119.55 screens as overvalued rather than 16.7% undervalued. This raises a simple question: which set of assumptions do you trust more?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Blackstone for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 41 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

If the split sentiment around Blackstone has you on the fence, take a closer look at both sides of the story and form your own view by weighing the 2 key rewards and 3 important warning signs

Looking for more investment ideas beyond Blackstone?

If you are weighing what Blackstone's story means for your portfolio, do not stop here. Broaden your watchlist before the next set of opportunities moves on without you.

• Spot potential upside in companies priced below their estimated worth by reviewing the 41 high quality undervalued stocks
• Strengthen your income stream by focusing on companies with higher yields through the 8 dividend fortresses
• Prioritize resilience by zeroing in on stocks that score well on financial stability using the 73 resilient stocks with low risk scores

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.