Insider buying can provide clues about a stock’s next move. Insiders sell company stock for a number of reasons. Yet they only buy stock for one reason – they expect it to rise.
In this report, we are going to highlight some interesting insider buying at Blackstone Inc (BX:US). Blackstone is a US-based alternative investment management company. The company, which serves pension funds, institutions, and high-net-worth individuals, invests in a variety of alternative asset classes including private equity, real estate, debt markets, and hedge funds. It’s listed on the New York Stock Exchange and currently has a market capitalization of $119.82 billion.
Insider buying at Blackstone
Our data shows that on July 28, board member Reg Brown snapped up 3,100 Blackstone shares at a price of $99.35 per share. This trade cost the insider approximately $308,000 and increased his holding to 8,635 shares.
This trade is worth flagging due to the fact that it has increased the size of Mr. Brown’s holding by 56%. The fact that the insider has upped his stake by over 50% suggests that he is confident the stock is set to move higher.
It’s worth pointing out that Mr. Brown is not the only insider at Blackstone to buy stock recently. In May, board member James Breyer invested approximately $1 million in stock. Meanwhile, in April, board member Ruth Porat – who was previously Vice Chair of Investment Banking at Morgan Stanley – invested over half a million in Blackstone shares.
Share price fall
Blackstone shares have trended lower this year. After rising to around $140 in February, the stock has pulled back to the $100 level.
This near-30% fall may not be justified. In Blackstone’s latest results, for the second quarter of 2022, the company reported fee related earnings of $1.0 billion, up 45% year on year. Meanwhile, distributable earnings rose 86% year on year to $2.0 billion. At the end of the period, the group had total assets under management of $940.8 billion, up 38% year-over-year.
“We delivered exceptional financial results for our shareholders in the second quarter despite a challenging market backdrop. Blackstone’s flagship strategies again outperformed public markets and our investors entrusted us with $88 billion of inflows, which represented the second highest quarter of inflows in our 36-year history,” commented Chairman and CEO Stephen A. Schwarzman.
Clearly, board members see value in the stock after the recent share price decline. We see the insider buying here as a bullish indicator.