© Reuters. BlackRock (BLK) an “attractive way to play surge of fixed income inflows’ – Keefe, Bruyette & Woods
Keefe, Bruyette & Woods upgraded shares of BlackRock (NYSE:) to Outperform from Market Perform, raising the price target to $835 from $770 in a note to clients Monday.
The firm’s analysts said the upgrade is in part due to the fact that the company is a beneficiary of high rates.
“BLK is delivering good consistent organic growth and profitability, and while equity markets are hard to predict from here, BLK’s diversification yields better balance and margin resiliency than peers,” wrote the analysts.
The analysts explained that BLK is “an attractive way to play the impending surge of fixed income inflows” on the active and passive side, with particular strength to garner a greater share as the secular growth of passives continues.
“Although flows are coming in below expectations for the quarter, we expect fixed income flows to accelerate meaningfully once the Fed and other central banks reach the end of hiking campaigns, and BLK will be a key beneficiary, particularly as passive continues to see wider adoption and gain share of the fixed income market,” the analysts concluded.
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