Shares of the leading investment management company Blackstone (NYSE:BX) closed 7.09% lower on December 1. Moreover, BX stock is down about 1.62% in the pre-market session on December 2 as an increase in redemptions from its popular real estate investment fund spooked investors.
The company limited the withdrawals from its Blackstone Real Estate Income Trust (BREIT) as redemption requests exceeded its monthly limit (2% of its net asset value). An increase in redemption could hurt the asset growth and performance of the company.
Concerns around higher interest rates, their related negative impact on REITs (Real Estate Investment Trusts), and the overall weak macro environment could be reasons why investors are cashing out.
Meanwhile, BRIET has delivered a return of 9.3% year-to-date. In comparison, according to the company. In comparison, the Dow Jones U.S. Real Estate Index and Invesco KBW Premium Yield Equity REIT ETF are down about 26.09% and 15.58%, respectively.
Highlighting BREIT’s performance, BX’s COO, Jon Gray, said during the Q3 conference call that “BREIT net returns since inception six years ago is 13% per year or 4x the public REIT index. Nearly 80% of BREITs portfolio is comprised of logistics and rental housing, some of the best performing sectors with short duration leases and rents outpacing inflation.”
In a separate development, Blackstone agreed to sell its stakes in MGM Grand and Mandalay Bay Properties to VICI.
Is BX a Good Stock to Buy?
BX stock has a Moderate Buy consensus rating on TipRanks based on 11 Buy, four Hold, and one Sell recommendations. Further, analysts’ average price target of $106.39, implies 25.11% upside potential.
Importantly, BX stock has negative signals from hedge funds and insiders. Hedge funds sold 213.8K BX stock last quarter. Meanwhile, insiders sold BX stock worth $5.3M.
Overall, Blackstone stock has a Neutral Smart Score of six on TipRanks.
