Keefe Bruyette & Woods Gives Color On Asset Management Firms

According to Keefe Bruyette & Woods, Blackstone's

revenues and earnings are highly sensitive to the investment performance of the company's underlying investment products. In addition, many of Blackstone's investment strategies entail substantial amounts of leverage and there is limited transparency into many of its investment products and strategies, including the estimation of AUM used to calculate incentive income and investment income, which can be volatile. Blackrock

has risks to the target price that include sensitivity to changes in investment performance and assets under management, as well as integration risk. BlackRock's revenues and earnings are very sensitive to changes in AUM. The changes are a function of investment performance, which in turn drives new business flows and investment returns on existing assets. Franklin Resources'

assets, revenues, and earnings are highly leveraged to the investment performance of Franklin's products specifically, as well as the broader equity and bond markets both within the U.S. and globally. In addition, our price target assumes that Franklin can continue to generate positive inflows, contributing to its premium valuation. BX is trading at $13.49 BLK is trading at $176.73 BEN is trading at $116.80