Blackstone (BX) has drawn fresh attention after committing US$5,000 million from its funds to a new U.S.-based joint venture with Google. The partnership targets data center capacity and access to Google Cloud’s Tensor Processing Units.

The Blackstone share price has moved around this year, with a 7 day share price return of 3.38% but a year to date share price return down 25.62%. In contrast, the 5 year total shareholder return of 51.58% reflects a very different long term picture for investors, and the latest Google data center venture appears to be the main catalyst now shaping sentiment.

If this AI focused partnership has caught your attention, it could be a good moment to see what other AI infrastructure opportunities are out there through our 47 AI infrastructure stocks

With Blackstone’s share price down 25.62% year to date, but the joint venture strengthening its AI credentials, is the stock still lagging its long term story or already pricing in future growth?

Most Popular Narrative: 27.2% Undervalued

At a last close of $118.12 versus a widely followed fair value estimate of $162.26, the current price sits well below that narrative anchor, which leans heavily on Blackstone’s ability to deploy large pools of capital into areas like AI infrastructure.

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. Blackstone's strategic alliance with Wellington and Vanguard aims to develop integrated public-private investment solutions, potentially expanding revenue channels by tapping into the private wealth market.

Want to see why this narrative supports a higher fair value than today’s price? The key ingredients are aggressive earnings growth, rising margins and a future earnings multiple usually reserved for faster growing sectors. Curious which assumptions drive that $162.26 figure, and how they connect to Blackstone’s AI and private credit ambitions? The full narrative lays out the numbers behind that view in detail.

Result: Fair Value of $162.26 (UNDERVALUED)

However, this hinges on private credit flows stabilising, and on tariff or trade tensions not putting renewed pressure on real estate values or portfolio company earnings.

Another View: What The P/E Ratio Is Saying

The narrative fair value of $162.26 points to a 27.2% undervaluation, but the current P/E of 30.4x tells a more cautious story. It sits below the US Capital Markets industry average of 40.1x, yet above both peers at 22.9x and a fair ratio of 24.6x.

That gap suggests the stock carries a richer valuation than similar companies and the level our fair ratio points to, even after recent share price weakness. For you, the key question is whether Blackstone’s AI, private credit and deal pipeline justify paying that premium.

Next Steps

With the market split between concern and optimism, it makes sense to review the data directly and act quickly to shape your own view with 3 key rewards and 3 important warning signs.

Looking for more investment ideas?

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• Target potential mispricings by scanning a curated set of quality stocks trading below their estimated value using the 46 high quality undervalued stocks
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• Reduce portfolio stress by concentrating on companies with healthier finances and robust fundamentals found through the solid balance sheet and fundamentals stocks screener (46 results)

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.