Blackstone Shares Plunge Amid Redemption Freeze
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 15 hours ago
0mins
Source: Benzinga
- Redemption Freeze Impact: Blue Owl Capital's decision to halt quarterly redemptions at its retail-focused private credit fund has rattled major alternative investment firms, including Blackstone, indicating market concerns over private credit exposure.
- Severe Market Reaction: Blackstone shares fell 5.58% to $125.48 on Thursday, reflecting investor unease regarding its significant exposure to private credit, contributing to a 25.06% decline over the past year.
- Technical Weakness: Blackstone's stock is trading significantly below key moving averages, with current prices 10.1%, 16.1%, and 19.4% below the 20-day, 50-day, and 200-day SMAs respectively, suggesting a bearish market sentiment with limited short-term recovery potential.
- Support and Resistance Analysis: Key support is at $118.50, and breaching this level could signal further downside risk, while resistance at $149.00 indicates a potential shift in momentum if surpassed.
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Analyst Views on BX
Wall Street analysts forecast BX stock price to rise
12 Analyst Rating
5 Buy
7 Hold
0 Sell
Moderate Buy
Current: 132.900
Low
166.00
Averages
176.60
High
205.00
Current: 132.900
Low
166.00
Averages
176.60
High
205.00
About BX
Blackstone Inc. is an alternative asset manager. Its asset management includes global investment strategies focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets, secondaries, and hedge funds. Its Real Estate segment comprises its management of opportunistic real estate funds, Core+ real estate funds, and real estate debt strategies. Its Private Equity segment includes its management of flagship Corporate Private Equity funds, sector and geographically focused Corporate Private Equity funds, core private equity funds, an investment platform, and others. Its Credit & Insurance segment consists of Blackstone Credit & Insurance, which is organized into three overarching strategies: private corporate credit, liquid corporate credit and infrastructure and asset-based credit. Its Multi-Asset Investing segment is organized into four investment platforms: Absolute Return, Multi-Strategy, Total Portfolio Management, and Public Real Assets.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
U.S. Markets Decline Amid Rising Tensions with Iran
- Market Volatility: U.S. markets experienced volatility on Thursday due to escalating tensions with Iran, with the S&P 500 down 0.28%, the Dow Jones Industrial Average down 0.54%, and the Nasdaq Composite down 0.31%, indicating investor concerns over geopolitical risks.
- Rising Oil Prices: Oil prices surged nearly 2% in U.S. trading amid fears that military action could disrupt oil supplies from Iran, reflecting market anxiety over energy security and potentially leading to increased costs for related industries, impacting the broader economy.
- Blue Owl Capital Liquidity Tightening: Blue Owl Capital's sale of $1.4 billion in loan assets resulted in a nearly 6% drop in its stock, raising alarms about the stability of the private credit market, which could undermine investor confidence and exacerbate market volatility.
- Japan's Inflation Data: Japan's headline inflation rate fell to 1.5% in January, the lowest since March 2022, with core inflation easing to 2%, which may influence the Bank of Japan's monetary policy decisions and subsequently affect global market liquidity.
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- Liquidity Crisis Warning: Senator Elizabeth Warren sharply criticized Blue Owl Capital's restriction on investor redemptions, likening the liquidity issues to a 'cockroach' that signals deeper, hidden problems, potentially leading to broader economic risks.
- Call for Federal Intervention: Warren directly urged the Trump administration to take action, warning that if left unchecked, these risky investments could spread to the wider economy, affecting ordinary Americans' retirement accounts.
- Stock Price Volatility: Following the announcement that Blue Owl would permanently replace quarterly redemptions in its $1.6 billion OBDC II fund with a 'return of capital' strategy, the firm's stock plummeted by as much as 5.93%, reflecting strong market reactions to its liquidity strategy.
- Company Defends Liquidity Strategy: Blue Owl CEO Craig Packer pushed back against the 'freeze' narrative during an earnings call, emphasizing that the move is an acceleration of liquidity rather than a blockade, with plans to return 30% of shareholder capital at book value over the next 45 days.
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US Markets Decline Amid Escalating Tensions with Iran
- Market Volatility: US markets experienced volatility on Thursday due to escalating tensions between Washington and Iran, with the S&P 500 dropping 0.28%, the Dow Jones Industrial Average falling 0.54%, and the Nasdaq Composite declining 0.31%, reflecting investor concerns over geopolitical risks.
- Oil Price Surge: Concerns over potential military action in Iran pushed oil prices up nearly 2%, which could impact global energy market stability and exacerbate inflationary pressures, thereby affecting consumer spending and business costs.
- Blue Owl Liquidity Tightening: Blue Owl Capital's sale of $1.4 billion in loan assets led to a nearly 6% drop in its stock, raising alarms about the stability of the private credit market, which may also affect the stock performance of other asset management firms.
- Walmart Earnings Beat: Walmart's fiscal fourth-quarter results exceeded expectations due to growth in e-commerce, advertising, and its third-party marketplace, but its earnings forecast for the current fiscal year fell short of market expectations, potentially impacting investor confidence in its long-term growth prospects.
See More
Blackstone Shares Plunge Amid Redemption Freeze
- Redemption Freeze Impact: Blue Owl Capital's decision to halt quarterly redemptions at its retail-focused private credit fund has rattled major alternative investment firms, including Blackstone, indicating market concerns over private credit exposure.
- Severe Market Reaction: Blackstone shares fell 5.58% to $125.48 on Thursday, reflecting investor unease regarding its significant exposure to private credit, contributing to a 25.06% decline over the past year.
- Technical Weakness: Blackstone's stock is trading significantly below key moving averages, with current prices 10.1%, 16.1%, and 19.4% below the 20-day, 50-day, and 200-day SMAs respectively, suggesting a bearish market sentiment with limited short-term recovery potential.
- Support and Resistance Analysis: Key support is at $118.50, and breaching this level could signal further downside risk, while resistance at $149.00 indicates a potential shift in momentum if surpassed.
See More
Significant Stock Movements Among Multiple Companies
- Klarna Guidance Miss: Klarna's shares plummeted about 25% as its first-quarter operating income guidance of $5 million to $35 million fell significantly short of Wall Street's expectation of $61.9 million, indicating potential challenges in future financing capabilities.
- Blue Owl Loan Sale: Blue Owl Capital's stock dropped nearly 10% after announcing the sale of $1.4 billion in loans at 99.7% of par value, with proceeds aimed at debt repayment and capital return, highlighting liquidity pressures and a halt on redemptions for retail investors.
- Omnicom Buyback Plan: Omnicom's shares surged 13% after reporting fourth-quarter revenue of $5.5 billion, a nearly 28% year-over-year increase, alongside a $5 billion share buyback authorization, reflecting strong financial performance and confidence in future growth.
- Deere Earnings Beat: Deere's stock rose 13% as it reported first-quarter earnings of $2.42 per share on $8 billion in revenue, both exceeding analyst expectations, indicating robust demand for agricultural equipment and potential market share growth ahead.
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Private Credit Companies' Decline: Shares of U.S. private credit companies have experienced a significant fall recently.
Impact of Blue Owl: The decline follows Blue Owl's decision to halt redemptions on its private credit retail fund, raising concerns in the sector.
See More
U.S. Markets Decline Amid Rising Tensions with Iran
- Market Volatility: U.S. markets experienced volatility on Thursday due to escalating tensions with Iran, with the S&P 500 down 0.28%, the Dow Jones Industrial Average down 0.54%, and the Nasdaq Composite down 0.31%, indicating investor concerns over geopolitical risks.
- Rising Oil Prices: Oil prices surged nearly 2% in U.S. trading amid fears that military action could disrupt oil supplies from Iran, reflecting market anxiety over energy security and potentially leading to increased costs for related industries, impacting the broader economy.
- Blue Owl Capital Liquidity Tightening: Blue Owl Capital's sale of $1.4 billion in loan assets resulted in a nearly 6% drop in its stock, raising alarms about the stability of the private credit market, which could undermine investor confidence and exacerbate market volatility.
- Japan's Inflation Data: Japan's headline inflation rate fell to 1.5% in January, the lowest since March 2022, with core inflation easing to 2%, which may influence the Bank of Japan's monetary policy decisions and subsequently affect global market liquidity.
See More
Warren Critiques Private Credit Industry Amid Blue Owl Concerns
- Liquidity Crisis Warning: Senator Elizabeth Warren sharply criticized Blue Owl Capital's restriction on investor redemptions, likening the liquidity issues to a 'cockroach' that signals deeper, hidden problems, potentially leading to broader economic risks.
- Call for Federal Intervention: Warren directly urged the Trump administration to take action, warning that if left unchecked, these risky investments could spread to the wider economy, affecting ordinary Americans' retirement accounts.
- Stock Price Volatility: Following the announcement that Blue Owl would permanently replace quarterly redemptions in its $1.6 billion OBDC II fund with a 'return of capital' strategy, the firm's stock plummeted by as much as 5.93%, reflecting strong market reactions to its liquidity strategy.
- Company Defends Liquidity Strategy: Blue Owl CEO Craig Packer pushed back against the 'freeze' narrative during an earnings call, emphasizing that the move is an acceleration of liquidity rather than a blockade, with plans to return 30% of shareholder capital at book value over the next 45 days.
See More
US Markets Decline Amid Escalating Tensions with Iran
- Market Volatility: US markets experienced volatility on Thursday due to escalating tensions between Washington and Iran, with the S&P 500 dropping 0.28%, the Dow Jones Industrial Average falling 0.54%, and the Nasdaq Composite declining 0.31%, reflecting investor concerns over geopolitical risks.
- Oil Price Surge: Concerns over potential military action in Iran pushed oil prices up nearly 2%, which could impact global energy market stability and exacerbate inflationary pressures, thereby affecting consumer spending and business costs.
- Blue Owl Liquidity Tightening: Blue Owl Capital's sale of $1.4 billion in loan assets led to a nearly 6% drop in its stock, raising alarms about the stability of the private credit market, which may also affect the stock performance of other asset management firms.
- Walmart Earnings Beat: Walmart's fiscal fourth-quarter results exceeded expectations due to growth in e-commerce, advertising, and its third-party marketplace, but its earnings forecast for the current fiscal year fell short of market expectations, potentially impacting investor confidence in its long-term growth prospects.
See More
Blackstone Shares Plunge Amid Redemption Freeze
- Redemption Freeze Impact: Blue Owl Capital's decision to halt quarterly redemptions at its retail-focused private credit fund has rattled major alternative investment firms, including Blackstone, indicating market concerns over private credit exposure.
- Severe Market Reaction: Blackstone shares fell 5.58% to $125.48 on Thursday, reflecting investor unease regarding its significant exposure to private credit, contributing to a 25.06% decline over the past year.
- Technical Weakness: Blackstone's stock is trading significantly below key moving averages, with current prices 10.1%, 16.1%, and 19.4% below the 20-day, 50-day, and 200-day SMAs respectively, suggesting a bearish market sentiment with limited short-term recovery potential.
- Support and Resistance Analysis: Key support is at $118.50, and breaching this level could signal further downside risk, while resistance at $149.00 indicates a potential shift in momentum if surpassed.
See More
Significant Stock Movements Among Multiple Companies
- Klarna Guidance Miss: Klarna's shares plummeted about 25% as its first-quarter operating income guidance of $5 million to $35 million fell significantly short of Wall Street's expectation of $61.9 million, indicating potential challenges in future financing capabilities.
- Blue Owl Loan Sale: Blue Owl Capital's stock dropped nearly 10% after announcing the sale of $1.4 billion in loans at 99.7% of par value, with proceeds aimed at debt repayment and capital return, highlighting liquidity pressures and a halt on redemptions for retail investors.
- Omnicom Buyback Plan: Omnicom's shares surged 13% after reporting fourth-quarter revenue of $5.5 billion, a nearly 28% year-over-year increase, alongside a $5 billion share buyback authorization, reflecting strong financial performance and confidence in future growth.
- Deere Earnings Beat: Deere's stock rose 13% as it reported first-quarter earnings of $2.42 per share on $8 billion in revenue, both exceeding analyst expectations, indicating robust demand for agricultural equipment and potential market share growth ahead.
See More
U.S. Private Credit Company Stocks Decline Following Blue Owl's Suspension of Redemptions for Retail Private Credit Fund
Private Credit Companies' Decline: Shares of U.S. private credit companies have experienced a significant fall recently.
Impact of Blue Owl: The decline follows Blue Owl's decision to halt redemptions on its private credit retail fund, raising concerns in the sector.
See More
