Blackstone Inc.BXNYSE

Overview Intelligence Charts News Fundamentals Key Metrics TTM Financials Earnings Growth Rating Analysts Institutional Peers Historical

DCF Valuation

⚠️Model Warnings

•Revenue projections show 31% decline from peak. Analyst estimates may reflect secular headwinds or transition period.

DCF Valuation Summary

Sell

Fair Value: $88.18 per share(market-calibrated)

-23.5%

Upside to Fair Value

Current

$115.33

Pure Model

$85.49

Fair Value

$88.18

Bull Case

$98.22

Bear Case

$69.82

Market Reality Check

Model Terminal Growth

2.50%

Market-Implied Growth

6.30%

Calibrated Growth

3.45%

Fair value uses 75% model / 25% market-implied terminal growth. Pure model: $85.49.

What's Driving This Ratingfor BX

✓

CapEx already efficient

CapEx at 1.01% of revenue is already at or below sector maintenance level. No normalization needed — cash conversion is already strong.

✓

Premium margins already priced in

EBIT margin of 55.08% is already well above sector average. The model holds this level — there's limited room for margin expansion to drive upside. Valuation depends primarily on revenue growth.

⚠

Analyst growth decelerates sharply

Revenue growth drops from 13.27% in Year 1 to 2.50% by Year 5 (per analyst consensus). This growth deceleration is a key reason the model may undervalue the stock if growth re-accelerates.

🎯

Market pricing in higher long-term growth

To justify $115.33, the market implies 6.30% perpetual growth — 380bps above the model's 2.50%. This suggests the market sees additional growth catalysts (AI, new products, market expansion) not captured in analyst estimates.

✓

Strong cash flow conversion

Year 10 FCF/EBITDA conversion of 81.27% indicates efficient cash generation. FCF reaches $7.4B by Year 10 (45.06% FCF margin).

Weighted Average Cost of Capital (WACC)

Cost of Equity (CAPM)

Risk-Free Rate (Rf)4.50%

Beta (β)1.76

Market Risk Premium4.50%

*Using current implied premium (4.5% per Damodaran 2026), not historical (6.5%)

Cost of Equity (Re)12.42%

Cost of Debt

Pre-tax Cost of Debt2.68%

Tax Rate15.69%

After-tax Cost of Debt2.26%

Equity Weight (E/V)86.41%

Debt Weight (D/V)13.59%

WACC Calculation

WACC = (E/V × Re) + (D/V × Rd × (1-Tc))

WACC = (86.41% × 12.42%) + (13.59% × 2.26%)

= 11.04%

10-Year Free Cash Flow Projections(showing years 1, 3, 5, 7, 10)

Year	Year 1	Year 3	Year 5	Year 7	Year 10
Revenue	$15.7B	$20.9B	$14.4B	$15.1B	$16.3B
EBIT	$8.6B	$11.5B	$7.9B	$8.3B	$9.0B
Tax	$1.4B	$1.8B	$1.2B	$1.3B	$1.4B
NOPAT	$7.3B	$9.7B	$6.7B	$7.0B	$7.6B
+ Depreciation	$58M	$77M	$53M	$56M	$60M
- Capex	$159M	$212M	$146M	$154M	$165M
- Δ NWC	$551M	$470M	$105M	$111M	$119M
Free Cash Flow	$6.6B	$9.1B	$6.5B	$6.8B	$7.4B
Discount Factor	0.901	0.730	0.592	0.480	0.351
Present Value	$6.0B	$6.7B	$3.8B	$3.3B	$2.6B

FCF Formula: Free Cash Flow = NOPAT + Depreciation - Capex - Change in Net Working Capital

Terminal Value Calculation

Perpetuity Growth Method

Year 10 FCF$7.4B

Terminal Growth Rate2.50%

WACC11.04%

TV = FCF₁₀ × (1+g) / (WACC-g)

Terminal Value$88.2B

PV of Terminal Value$30.9B

Exit Multiple Method

Year 10 EBITDA$9.0B

Exit Multiple (EV/EBITDA)12.0x

TV = EBITDA₁₀ × Exit Multiple

Terminal Value$108.5B

PV of Terminal Value$38.1B

Valuation Summary

Perpetuity Growth Method

PV of Projected FCFs$43.6B

PV of Terminal Value$30.9B

Enterprise Value$74.5B

(-) Net Debt$11.3B

Equity Value$63.2B

Shares Outstanding781M

Price per Share$80.92

Exit Multiple Method

PV of Projected FCFs$43.6B

PV of Terminal Value$38.1B

Enterprise Value$81.6B

(-) Net Debt$11.3B

Equity Value$70.3B

Shares Outstanding781M

Price per Share$90.06

Pure Model Fair Value

$85.49

Average of perpetuity growth and exit multiple methods (before market calibration)

Sensitivity AnalysisPrice per Share

WACC ↓ / Growth →	1.50%	2.00%	2.50%	3.00%	3.50%
9.04%	$102.10	$104.13	$106.48	$109.21	$112.43
10.04%	$91.84	$93.29	$94.93	$96.80	$98.96
11.04%	$83.24	$84.30	$85.49	$86.82	$88.33
12.04%	$75.89	$76.69	$77.58	$78.56	$79.65
13.04%	$69.52	$70.14	$70.81	$71.54	$72.36

How to read: This table shows how the valuation changes with different WACC (discount rate) and terminal growth rate assumptions. Green = undervalued, Red = overvalued.

Scenario Analysis

Bear Case

$69.82

-39.5% vs current

• -25% vs analyst consensus
• Terminal growth: 2.0%
• Beta: 2.20

Base Case

$85.49

-25.9% vs current

• Analyst consensus
• Terminal growth: 2.5%
• Beta: 1.76

Bull Case

$98.22

-14.8% vs current

• +25% vs analyst consensus
• Terminal growth: 3.0%
• Beta: 1.50

Key Assumptions & Drivers• Financial Services Sector

Growth Assumptions (Select Years)

Year 1 Revenue Growth13.27%

Year 3 Revenue Growth8.10%

Year 5 Revenue Growth2.50%

Year 7 Revenue Growth2.50%

Year 10 Revenue Growth2.50%

Terminal Growth Rate2.50%

Margin & Efficiency

Current EBIT Margin55.08%

Tax Rate15.69%

Historical Capex / Rev1.01%

NWC / Revenue30.00%

Key Drivers: Revenue growth, operating margin expansion, capex efficiency, and working capital management are the primary drivers of cash flow generation. Terminal value assumptions significantly impact final valuation.

Institutional-Grade Methodology

Actual Company Data: Revenue, EBIT, Capex, NWC, Tax Rate, Interest Expense, Beta

Market Assumptions: Risk-free: 4.5% (10Y), MRP: 4.5% (Damodaran 2026), Exit: 12x EV/EBITDA (Financial Services sector)

This DCF model is for informational purposes only. Projections are based on assumptions that may not materialize. Past performance does not guarantee future results. Consult a financial advisor before making investment decisions.

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