Blackstone Bullish on Deal Flow

The average estimate of analysts polled by Thomson Reuters was for a 15 cents a share in the September period on revenue of $450.6 million. Revenue for the latest period got a boost from appreciation in the fair value of portfolio investments in the company's corporate private equity and credit and marketable alternatives businesses as well as stabilization in its real estate portfolio.

On a GAAP (generally accepted accounting principles) basis, Blackstone lost $176.2 million in the latest quarter, compared to $340.3 million a year ago. The latest GAAP results include $201 million in IPO- and acquisition-related charges, the company said, as well as other items.

The company's comments about deal flow were interesting. The best way to gauge how bullish the firm is may be to look at how much money it's actually putting to work. While in the depths of the recession, Blackstone executives repeatedly talked about bleak times being the best for deal-making.

While the pace of investing was slowed from the boom levels of 2004-2007 by the frosty credit markets of the past year, the difference between how much capital Blackstone deployed in the most recent third quarter and last year's equivalent period, when the financial crisis was arguably at its worst with Lehman Brothers filing for bankruptcy protection, is striking.

This past quarter, the company deployed just $109.5 million of limited partner capital. That compares to $1.5 billion in the same period a year earlier, and $338.5 million in the second quarter. During the third quarter of fiscal 2007, when the buyout boom peaking, Blackstone deployed $2.3 billion of limited partner capital.