In this article, we discuss 10 value stocks in Blackstone Group’s portfolio. If you want to skip our detailed analysis of these stocks, go directly to 5 Value Stocks in Blackstone Group’s Portfolio.
Blackstone Group is headed by Stephen Schwarzman, who co-founded the alternative investment manager in 1985.
Although Blackstone Group focuses mostly on private and alternative investment management now, it was originally founded as a mergers and acquisitions advisory firm. The company ventured into private equity after the stock market crash of October 1987, adopting a merchant banking model and becoming an investment partner rather than just an advisor to its clients.
Blackstone Group invests mainly in energy stocks, with interests lying in the real estate, utilities and telecommunications, healthcare, finance, industrials, and information technology sectors as well. With a top ten holdings concentration of 56.88%, the largest holding in the firm’s Q4 portfolio is Cheniere Energy Partners, L.P. (NYSE:CQP), a liquefied natural gas company headquartered in Texas, with Blackstone Group owning close to 204 million shares of the company, worth $8.60 billion, representing 21.56% of the total 13F securities. The firm holds a mix of growth and value plays in its portfolio.
The most notable securities held by Blackstone Group as of the fourth quarter of 2021 include Change Healthcare Inc. (NASDAQ:CHNG), Bumble Inc. (NASDAQ:BMBL), and DoorDash, Inc. (NYSE:DASH).
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Our Methodology
We used the Q4 portfolio of Blackstone Group for this analysis, picking securities with a price to earnings ratio of below or close to 15. We made sure to pick stocks with mostly positive analyst ratings, ranking the list according to the hedge fund sentiment around the holdings.
Data from 924 elite hedge funds tracked by Insider Monkey in the fourth quarter of 2021 was used to assess the hedge fund sentiment around each stock.
Value Stocks in Blackstone Group’s Portfolio
10. MPLX LP (NYSE:MPLX)
Number of Hedge Fund Holders: 8
P/E Ratio: 11.08
MPLX LP (NYSE:MPLX) operates as a subsidiary of Marathon Petroleum Corporation, managing midstream energy infrastructure and logistics assets across the United States. Blackstone Group, as of Q4 2021, owns over 66 million shares of MPLX LP (NYSE:MPLX), worth $1.95 billion, representing 4.9% of the fund’s 13F portfolio.
MPLX LP (NYSE:MPLX) posted its Q4 earnings on February 2, reporting an EPS of $0.78, surpassing estimates by $0.04. The company’s revenue gained 21.57% year-on-year, reaching $2.73 billion, outperforming estimates by $283.32 million.
On January 25, MPLX LP (NYSE:MPLX) declared a quarterly dividend of $0.705 per share, in line with previous. The dividend was paid on February 14, to shareholders of record on February 4. The company delivers a yield of 8.90% as of February 25.
Citi analyst Timm Schneider raised the price target on MPLX LP (NYSE:MPLX) on January 19 to $36 from $32 and kept a Buy rating on the shares. The analyst estimates that MPLX LP (NYSE:MPLX) will be able to generate $5 billion of excess cash through 2025, or 20% of the current market cap. The company is in a position to return $1 billion in excess cash annually to shareholders, all else equal and no outsized increases in capex, Schneider told investors in a bullish thesis.
According to the Q4 database of Insider Monkey, 8 hedge funds were long MPLX LP (NYSE:MPLX), with total stakes worth $50.3 million. Chiron Investment Management is a leading shareholder of MPLX LP (NYSE:MPLX), owning 539,782 shares valued at approximately $16 million.
In addition to Change Healthcare Inc. (NASDAQ:CHNG), Bumble Inc. (NASDAQ:BMBL), and DoorDash, Inc. (NYSE:DASH), MPLX LP (NYSE:MPLX) is a significant holding in the Q4 portfolio of Blackstone Group.
Here is what Miller/Howard Investments has to say about MPLX LP (NYSE:MPLX) in its Q1 2021 investor letter:
“Lastly, we added MPLX LP (MPLX) in the with-MLP version. MLPX pays a high dividend and is cheap relative to similar pipeline companies… We increased our weight in MPLX LP (MPLX) which provides exposure to Permian volumes and northeast natural gas volumes. In addition, the company’s FCF yield was above the portfolio’s FCF yield.”
9. Western Midstream Partners, LP (NYSE:WES)
Number of Hedge Fund Holders: 10
P/E Ratio: 11.26
Western Midstream Partners, LP (NYSE:WES) is a Texas-based company that operates midstream assets primarily in the United States, supplying crude oil, natural gas, natural gas liquids, and condensate. Blackstone Group owns a $435.4 million stake in Western Midstream Partners, LP (NYSE:WES) as of Q4 2021, which accounts for 1.09% of the firm’s total 13F securities.
Western Midstream Partners, LP (NYSE:WES) announced on January 21 a $0.327 per share quarterly dividend, a 1.3% increase from its prior dividend of $0.323. The dividend was paid on February 14. Western Midstream Partners, LP (NYSE:WES) delivers a 5.34% yield as of February 25.
On January 20, Barclays analyst Theresa Chen told investors that she expects “more variability” across refining results in Q4, but has a “generally positive outlook for the group in 2022.” She raised the price target on Western Midstream Partners, LP (NYSE:WES) to $28 from $24 and kept an Overweight rating on the shares.
Among the hedge funds tracked by Insider Monkey, 10 funds were bullish on Western Midstream Partners, LP (NYSE:WES) in Q4 2021, with combined stakes amounting to $106.7 million. Arrowstreet Capital owns the largest stake in the company, with more than 2 million shares worth $46 million.
Here is what Miller/Howard Investments has to say about Western Midstream Partners, LP (NYSE:WES) in its Q1 2021 investor letter:
“We increased our weight in Western Midstream Partners (WES) again this quarter, as it should benefit from higher oil prices that might lead to more drilling activity in the Permian and DJ basins.”
8. Finance Of America Companies Inc. (NYSE:FOA)
Number of Hedge Fund Holders: 14
P/E Ratio: 0.42
Blackstone Group owns more than 74 million shares of Finance Of America Companies Inc. (NYSE:FOA), worth $294 million, representing 0.73% of the total 13F securities. Finance Of America Companies Inc. (NYSE:FOA) operates a consumer lending platform in America, providing home loans, reverse mortgages, commercial loans, lender services, and capital management.
On October 11, Morgan Stanley analyst James Faucette initiated coverage of Finance Of America Companies Inc. (NYSE:FOA) with an Equal Weight rating and a $5 price target. Its business still remains largely tied to headline origination volumes, said the analyst.
Billionaire Leon Cooperman’s Omega Advisors is the biggest stakeholder of Finance Of America Companies Inc. (NYSE:FOA), with over 5 million shares worth $20.1 million. Overall, 14 hedge funds were bullish on the stock at the end of December 2021.
7. Blackstone Mortgage Trust, Inc. (NYSE:BXMT)
Number of Hedge Fund Holders: 15
P/E Ratio: 11.44
Blackstone Mortgage Trust, Inc. (NYSE:BXMT) is a New York-based real estate finance company that assists with senior loans collateralized by commercial properties in North America, Europe, and Australia. Blackstone Group owns 6.63 million Blackstone Mortgage Trust, Inc. (NYSE:BXMT) shares, worth $203 million, representing 0.50% of the firm’s 13F portfolio.
On February 9, Blackstone Mortgage Trust, Inc. (NYSE:BXMT) reported its Q4 results, posting an EPS of $0.78, exceeding estimates by $0.16. Revenue over the period jumped approximately 59% year-on-year to $173.94 million, topping market consensus by $50.61 million.
Offering a forward yield of 8.09%, Blackstone Mortgage Trust, Inc. (NYSE:BXMT) declared a $0.62 per share quarterly dividend on December 15, in line with previous. The dividend was distributed on January 14.
Keefe Bruyette analyst Jade Rahmani upgraded Blackstone Mortgage Trust, Inc. (NYSE:BXMT) on November 29 to Outperform from Market Perform with an unchanged price target of $34.
Among the hedge funds tracked by Insider Monkey in the fourth quarter of 2021, 15 funds reported owning stakes worth $169 million in Blackstone Mortgage Trust, Inc. (NYSE:BXMT). John Armitage’s Egerton Capital Limited is the leading stakeholder of the company, with 2.8 million shares worth roughly $88 million.
6. Algonquin Power & Utilities Corp. (NYSE:AQN)
Number of Hedge Fund Holders: 16
P/E Ratio: 15.01
Headquartered in Oakville, Canada, Algonquin Power & Utilities Corp. (NYSE:AQN) invests in hydroelectric, wind, and solar power facilities, in addition to utility assets across Canada, the United States, Chile, and Bermuda. Blackstone Group owns 900,000 Algonquin Power & Utilities Corp. (NYSE:AQN) shares, worth $42.5 million, accounting for 0.10% of the fund’s total 13F securities for Q4 2021.
Algonquin Power & Utilities Corp. (NYSE:AQN) declared on November 11 a $0.1706 per share quarterly dividend, in line with previous, paid on January 14. The company offers a dividend yield of 4.79% as of February 25.
BMO Capital analyst Ben Pham upgraded Algonquin Power & Utilities Corp. (NYSE:AQN) on November 11 to Outperform from Market Perform with an unchanged price target of $17, following the company’s acquisition of Kentucky Power and associated $650 million equity offering. While there remain deal and integration risks, Algonquin Power & Utilities Corp. (NYSE:AQN) has a proven track record in acquiring and integrating U.S. utilities, the analyst told investors in a research note.
Billionaire Ken Griffin’s Citadel Investment Group is the biggest stakeholder of Algonquin Power & Utilities Corp. (NYSE:AQN), with 1.20 million shares worth $56.5 million. Overall, 16 hedge funds were bullish on the stock in the fourth quarter of 2021.
Just like Change Healthcare Inc. (NASDAQ:CHNG), Bumble Inc. (NASDAQ:BMBL), and DoorDash, Inc. (NYSE:DASH), institutional investors are steadily pouring into Algonquin Power & Utilities Corp. (NYSE:AQN).
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Disclosure: None. 10 Value Stocks in Blackstone Group’s Portfolio is originally published on Insider Monkey.
