Saudi Investment Helps Solidify Long Thesis For Blackstone

Shares of Blackstone Group LP

27% profit every 20 days?

This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.


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27% profit every 20 days?

This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.


(NYSE:BX) gained more than 6 percent on Monday and hit a new 52-week high of $32.10 after the company successfully raised $20 billion for an infrastructure fund.The government of Saudi Arabia pledged $20 billion to Blackstone's newly created infrastructure investment vehicle with the ultimate aim of raising another $20 billion from other investments and ultimately bring the total to $100 billion.

Hope For Infrastructure?

While this may be an encouraging development to kick-start a much needed program of repairing roads, bridges and other infrastructure projects, the capital raise is a positive for Blackstone's equity investors.

Credit Suisse's Craig Siegenthaler maintains an Outperform rating on Blackstone's stock with a price target raised from $42 to $45 after the announcement. According to the analyst, Blackstone could raise another $40 billion of additional capital for infrastructure investments by the end of 2018 and the infrastructure business will add up to 10 cents of incremental Fee Related Earnings by 2020.

The analyst is also estimating that the infrastructure unit will generate around $0.20 of carry/year on average when its assets under management reaches just $40 billion.

Bottom line, to date, the largest infrastructure fund ever created was Global Infrastructure Partners' $15.8 billion initiative. However, Blackstone's fund would likely be at least three times the size or more and will target gross returns in the 10 to 15 percent range with one-third of returns derived in the form of capital return.

At last check, shares of Blackstone were up 6.83 percent at $31.91.

Related Links:Mario Gabelli's Game Plan To Profit From An Infrastructure BillJim Cramer's 2 Picks For Trump's Infrastructure Project
Posted In: Analyst ColorLong IdeasNewsEmerging MarketsFinancingContractsMarketsAnalyst RatingsMoversTrading IdeasblackstoneCraig SiegenthalerDonald Trumpinfrastructure