Blackstone (BX) is back in focus after helping launch Ode with Anthropic, an AI services company backed by a global investor consortium. This has raised fresh questions about how its growing AI exposure might influence the stock.

Recent moves into AI services sit against a weaker share price backdrop, with Blackstone’s share price down 22.16% year to date and its 1 year total shareholder return down 23.15%. However, the 3 year total shareholder return of 29.02% points to a stronger longer term record.

If Blackstone’s AI push has caught your attention, you may also want to see what other AI focused stocks are offering right now through the 31 AI small caps.

Blackstone’s AI push via Ode comes as the stock has fallen this year yet still carries a strong multi year return record. Do those cross currents leave the current valuation skewed toward the upside or the downside for new buyers?

Most Popular Narrative: 13.8% Undervalued

At a last close of $123.61 versus a narrative fair value of $143.45, the most followed view sees Blackstone trading below its long term potential.

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 what sits behind that valuation gap? The narrative leans on strong inflows, higher margins and a very specific path for earnings and revenue.

Result: Fair Value of $143.45 (UNDERVALUED)

However, Blackstone’s story can change quickly if tariff-driven cost pressures hit real estate values or if market volatility delays asset sales and fee realizations.

Another View: What Blackstone's P/E Is Signalling

While the community narrative points to Blackstone trading below a fair value of $143.45, the current P/E of 31.8x tells a more cautious story. It sits below the US Capital Markets average of 39.3x, yet above both peers at 22.5x and a fair ratio of 26.5x. That mix of relative premium and fair ratio gap raises a straightforward question: is the current price leaving enough room for error?

Next Steps

That mix of optimism around Blackstone and concern about potential setbacks makes this a good moment to look at the numbers yourself and move quickly to shape an informed view, including weighing its 2 key rewards and 3 important warning signs.

Looking for more investment ideas beyond Blackstone?

If Blackstone has sharpened your interest in opportunities, do not stop here. Broaden your watchlist with other focused ideas that could complement your portfolio.

• Spot potential mispricings early by scanning 45 high quality undervalued stocks that combine attractive fundamentals with room for the story to develop.
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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.