The building sector continues to be one of the leaders in the market. It has been at, or near, the top for almost a year. I love trends in the market. Trends can be profitable. That is, until they break.
Data from Best Stocks Now App
Small and mid-cap equities are still highly ranked asset classes at the current time, and Blackstone fits into that mid-cap range.Data from Best Stocks Now App Headquartered in New York City, where you can now get a supersized Mountain Dew once again, the company has a market value of $23 billion. (The chart below shows the market cap excluding fully diluted units.) Data from Best Stocks Now App My first walk-through is the performance of the stock over the years. Data from Best Stocks Now App As you can see, the stock has outperformed the market by a wide margin over one, three and five years. It should be noted that the stock was down 67% in 2008 when the market was down 38.5%. However, when I compare the performance of Blackstone against the 3,200 stocks that I follow, it scores a performance grade of "A." My second test is valuation. Performance and momentum is one thing, but valuation is a critical piece of the puzzle: Data from Best Stocks Now App The stock is currently trading at just 7.5 times next year's earnings estimates. It is expected to grow those earnings by 13.6% per year over the next five years. That means it's trading at a discount to its growth rate. Blackstone currently has a PEG ratio of 0.55 and a juicy dividend yield of 8.6%. Furthermore, when I apply a multiple that I deem to be appropriate to its five-year EPS estimate, I establish a five-year price target that is still is a great deal higher than the current price. The stock passes my valuation test. The third part is a visual test. I never buy a stock without first checking a one-year chart: I never buy stocks that are in downtrends. I don't really like sideways trends either. Something needs to happen first. Is it going to break to the downside or the upside? I don't like to buy extended trends either. My favorite chart pattern is a fresh breakout.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts