If you’re watching BlackRock (BLK) right now, today’s announcement should be on your radar. The company is committing up to £500 million to modernize UK data centers in partnership with Digital Gravity Partners, specifically targeting infrastructure that will be upgraded to handle the latest AI hardware. As global tech giants ramp up efforts to build out AI capabilities, BlackRock’s high-profile move puts it at the center of the conversation about who is powering the next phase of digital transformation in the UK.

This fresh investment adds to a remarkable year for BlackRock. Over the past year, the stock has posted a total return of 25%, with momentum building strongly in the past 3 months. While recent months saw some fluctuations, the bigger trend points toward growth, building on solid annual revenue and net income increases. Other major players in AI infrastructure have also announced ambitious UK projects. BlackRock’s focus on updating legacy assets for the AI era is a notable pivot that reflects changing market needs and potential new avenues for value creation.

The real question for investors, after such strong performance and with this strategic shift in play, is whether BlackRock is now attractively priced or if expectations for AI-driven growth are already baked in?

Most Popular Narrative: 2.1% Undervalued

According to the most widely followed narrative, BlackRock is seen as slightly undervalued, with the current share price trailing consensus fair value by just over 2 percent. This assessment hinges on analyst expectations about the company’s future growth, margins, and broader trends in global finance.

"BlackRock's expansion into private markets through acquisitions like HPS Investment Partners, GIP, and ElmTree positions the company to capitalize on the secular shift of institutional assets into alternatives and infrastructure. This is driving higher-fee revenue streams and supporting long-term earnings growth."

Want to know what’s propelling this bullish outlook? A set of bold growth projections and financial levers could tip the valuation scales. There is a surprising revenue and earnings forecast built into the numbers. Could this change how you view the company’s true potential?

Result: Fair Value of $1167.20 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent fee pressure and risks in integrating private market acquisitions could quickly shift the outlook for BlackRock’s growth if these challenges are not managed well.

Find out about the key risks to this BlackRock narrative.

Another View: Market-Based Valuation

Looking from a broader market perspective, BlackRock appears expensive when compared to industry averages by this method. This challenges the previous view and raises questions about whether the optimism is already priced in.

See what the numbers say about this price — find out in our valuation breakdown.

Stay updated when valuation signals shift by adding BlackRock to your watchlist or portfolio. Alternatively, explore our screener to discover other companies that fit your criteria.

Build Your Own BlackRock Narrative

If you see the numbers differently or want to dig deeper on your own, you can build your own perspective in just a few minutes. Do it your way

A great starting point for your BlackRock research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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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.