Despite Competition, BlackRock (BLK) Shares Poised for Growth
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With $3.6 trillion in assets, BlackRock (NYSE: BLK) is the largest investment management company in the world. However, shares of BlackRock have underperformed the market and are higher by only 4 percent this year. In a weekend article, Barron's said they believe Blackrock is undervalued.
According to the article, major drags on Blackrock shares include increased competition form rival companies, Vanguard and Charles Schwab (NYSE: SCHW), whose ETF offerings feature cut-rate fees. In response, Blackrock has plans to cut fees in order to remain competitive and to maintain its dominant share of the ETF market. Despite this, BlackRock is set to grow earnings as ETFs continue to remain popular.
There is also talk that the company's CEO, Laurence Fink, could depart for a job in the White House as Treasure Secretary in a re-elected Obama administration. Although he would be missed, most don't see a significant change to BlackRock's prospects.
Shares of BlackRock are indicated to open 1 percent higher to $186.22 following the bullish piece.
According to the article, major drags on Blackrock shares include increased competition form rival companies, Vanguard and Charles Schwab (NYSE: SCHW), whose ETF offerings feature cut-rate fees. In response, Blackrock has plans to cut fees in order to remain competitive and to maintain its dominant share of the ETF market. Despite this, BlackRock is set to grow earnings as ETFs continue to remain popular.
There is also talk that the company's CEO, Laurence Fink, could depart for a job in the White House as Treasure Secretary in a re-elected Obama administration. Although he would be missed, most don't see a significant change to BlackRock's prospects.
Shares of BlackRock are indicated to open 1 percent higher to $186.22 following the bullish piece.
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