Investment Q&A

BX reported distributable earnings per share of $0.94, down 11% compared to last year of $1.06. BX’s AUM grew slightly by 6% to slightly more than $1T. The overall industry is experiencing a headwind of high interest rates, leading to less realized performance revenue (due to dire capital markets making it harder to exit investments at attractive valuations).  Overall, though, we continue to like the asset management business as a capital-light growth business. Coming out of this downturn, we expect BX will keep growing its distributable earnings at attractive rates while growing dividends and buyback at the same time. BX has done well this year despite the markets, and we would continue to view it positively. We also like other asset managers such as ARES and BN, BX’s earnings are cyclical due to its dependence on realized performance earnings compared to ARES, which is more recurring.