Blackstone (BX) Stock Looks Expensive With Fair Value 13% Lower

Blackstone stock has delivered a 35.4% gain over the past three years, yet the latest valuation work suggests the shares trade at a premium, with both the intrinsic value estimate and market multiples pointing in the same, more cautious direction.

• Over the last three years, Blackstone has returned 35.4%, which gives investors some gains to weigh against a less generous current pricing signal.
• Excitement around Blackstone’s AI related investments and expansion into areas like energy transition and new investment solutions can support higher growth expectations, while slower individual investor demand in parts of the private credit business may cap how much investors are willing to pay for that story.
• Blackstone scores just 1 out of 6 on broader valuation checks, which tilts the picture toward the stock looking expensive rather than like a clear bargain.

The issue now is whether Blackstone’s current share price still leaves enough upside compared with the intrinsic value estimate from the Excess Returns model and what the usual earnings multiples imply.

Find out why Blackstone's -22.3% return over the last year is lagging behind its peers.

Is Blackstone Getting Expensive on Excess Returns?

The Excess Returns model looks at how much profit Blackstone can generate over its equity base relative to the return that shareholders require. For Blackstone, the inputs are punchy. Book value sits at $11.27 per share and the model uses a stable earnings figure of $5.39 per share, based on future return on equity estimates from 7 analysts. That is paired with an average return on equity of 44.94%, a cost of equity of $0.95 per share and an excess return of $4.44 per share, with stable book value assumed at $12.00 per share.

Those inputs lead to an intrinsic value estimate of $113.47 per share, which is below the current share price and implies the stock screens as overvalued by about 12.6%. The recent jump in profits tied to AI related investments and fundraising helps explain why investors are willing to pay above what this model suggests is a reasonable level.

On this Excess Returns view, Blackstone stock currently appears overvalued relative to the cash generation implied by its equity base.

Our Excess Returns analysis suggests Blackstone may be overvalued by 12.6%. Discover 55 high quality undervalued stocks or create your own screener to find better value opportunities.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Blackstone.

Is Blackstone Getting Expensive on Earnings?

The P/E ratio is a useful way to look at Blackstone because earnings are a key driver of how investors value asset managers. Blackstone currently trades on a P/E of 29.0x, which sits below the broader Capital Markets industry average of 37.6x but above the peer group average of 23.1x.

The fair P/E ratio for Blackstone, based on its earnings profile, size and risk, is estimated at 26.1x. That is lower than the current 29.0x multiple, which suggests the shares are priced ahead of what this framework indicates is reasonable, including current enthusiasm around AI related investments and new solutions in areas such as energy transition and private markets access.

On the P/E multiple, Blackstone stock appears overvalued relative to what its earnings characteristics would typically support.

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

The Blackstone Narrative: What Would Justify Today's Price?

Simply Wall St Narratives for Blackstone pick up where this valuation puzzle leaves off and explain what would need to happen to Blackstone's growth, margins and earnings for the stock to be worth materially more or less than today's price on the Community page. Rather than relying on a single multiple or model output, each Narrative sets out the assumptions that sit behind its fair value view so you can track those against actual results over time.

The Blackstone community is divided between a scenario that emphasizes strong capital flows and AI-related buildouts, and one that focuses on execution risks and slower realization trends.

Bull case: 11% undervalued

"Blackstone has raised $62 billion of inflows in Q1 2025, marking the highest level in three years, which boosts assets under management (AUM) and gives the company a strong foundation for future revenue growth…"

Read the full Bull Case to see why Blackstone could be undervalued

Bear case: 7% overvalued

"Blackstone's rapid growth in its infrastructure and private wealth businesses might lead to challenges in sustaining high net margins, as the associated upfront costs and investment focus could lead to operational inefficiencies, impacting future earnings negatively…"

Read the full Bear Case to see why Blackstone could be overvalued

Do you think there's more to the story for Blackstone? Head over to our Community to see what others are saying!

The Bottom Line

For Blackstone, both the Excess Returns intrinsic value estimate and the P/E based assessment point to the stock looking overvalued rather than clearly cheap. Broader valuation checks are also weak, which reinforces that message instead of offsetting it. The crux for investors now is whether Blackstone can deliver the growth and profitability that would keep justifying a premium to its intrinsic value and tailored P/E, or whether expectations eventually cool and the valuation settles closer to those frameworks.

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.

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