Earnings Reports

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Blackrock reported better than expected first quarter earnings before the bell on Thursday. $BLK saw higher income from it's ETF and investment management income, reporting after Goldman Sachs $GS,  Wells Fargo $WFC and JPMorgan $JPM. BlackRock closed the quarter with over $9 trillion in total assets under management.

Blackrock

Blackrock NYSE: BLK · Report Before Open Thursday

$7.77 Beat $7.68 EPS Expected and $4.31 Beat $4.30 billion Revenue Forecast

Earnings

BlackRock on Thursday reported adjusted net income of $1.2 billion, or $7.77 a share, beating the $7.68 estimate of analysts surveyed by FactSet. Revenue of $4.4 billion vs. analysts’ expectations of $4.31 billion.

Net flows into long-term investment products including ETFs and cash totaled $172 billion as of March 31, BlackRock said, a stark reversal from a year ago when investors withdrew a net of about $18.7 billion amid the onset of the pandemic and a global panic-driven selloff in stocks. BlackRock's assets under management rose to a record $9 trillion in the quarter, compared with $6.47 trillion a year earlier. Fixed income accounted for a bulk of the inflows, as expectations of policy tightening by the Federal Reserve triggered large moves in debt markets and pushed up U.S. Treasury yields. 

Revenue from investment advisory and administration fees, which makes up most of BlackRock's earnings, rose to $3.47 billion in the quarter, from $2.9 billion a year earlier.

Blackrock Consensus Expectations

Expectations are for EPS of $8.26, on revenue of $4.30 billion.

Blackrock is expected to post quarterly earnings of $8.26 per share for the first quarter, which represents a year-over-year change of +25.2%. Revenues are expected to be $4.3 billion, up 15.8% from the year-ago quarter. GAAP operating income rose 126% on a year-over-year basis, while per-share earnings gained 51%.

BlackRock closed 2020 with $8.677 trillion in total assets under management. Its iShares platform is the leading domestic and global provider of exchange-traded funds generating solid organic growth. Analysts say BlackRock has the potential to generate 3%-5% average annual organic AUM growth.

 Big Banks Kick Off First Quarter 2021 Earnings Season

The bank rally has been fueled by expectations for the economy reopening and infrastructure spending.  The new surge in home prices has also buoyed optimism for the mortgage business and banks profits thereto.

Blackrock NYSE: BLK

Market Reaction: $817.84 ▲ 16.77 (+2.09%) Close · April 15

Highlights

“BlackRock’s differentiated platform and our insights on some of the biggest issues society is facing today are resonating with clients,” BlackRock CEO Larry Fink said in a statement.

  • Investment advisory, administration fees and securities lending revenue increased $199 million from the fourth quarter of 2020
  • BlackRock said securities lending revenue slipped to $127 million from $131 million.
  • Performance fees increased $88 million, “primarily reflecting higher revenue from liquid alternative and long-only products.”
  • BlackRock recently disclosed that it has begun trading Bitcoin futures. According to filings with the U.S. Securities Exchange Commission, the world's largest asset manager held $6.5 million in Bitcoin futures contracts earlier this year. Those contracts registered a gain of about $360,000 by Jan. 31, when it was reported to the SEC.

PNC Exit Stake in Blackrock

In the second quarter of 2020 PNC sold their passive equity stake in BlackRock. In November they announced thier plan to redeploy those proceeds to acquire BBVA USA. PNC in November said it would acquire the U.S. banking operations of Spain's BBVA for $11.6 billion cash, making it the biggest regional bank by assets under management in the U.S. The transaction is expected to close in mid-2021 and will increase PNC's total assets by an estimated $102 billion, creating the fifth largest bank by assets.

Source: PNC Earnings Release 

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