RiverPark Advisors, an investment advisory firm and sponsor of the RiverPark family of mutual funds, released its “RiverPark Large Growth Fund” third quarter 2024 investor letter. A copy of the letter can be downloaded here. During the third quarter, the markets performed strongly with the Russell 1000 Growth Index (RLG) and the S&P 500 index returning 3.19% and 5.89% respectively and RPX returning 3.73%. A weaker-than-expected jobs report that raised fears of a coming recession caused the RLG to drop 8.8% from the end of June to the fifth of August, giving the quarter a rocky start. As China passed a significant stimulus package and the Fed began its rate-cutting cycle with a 0.50% decrease to a goal of 4.75%-5.00%, those losses quickly reversed. In addition, please check the fund’s top five holdings to know its best picks in 2024.
RiverPark Large Growth Fund highlighted stocks like Blackstone Inc. (NYSE:BX), in the third quarter 2024 investor letter. Blackstone Inc. (NYSE:BX) is one of the largest alternative asset management firms specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity and multi-asset class strategies. The one-month return of Blackstone Inc. (NYSE:BX) was -11.50%, and its shares gained 32.96% of their value over the last 52 weeks. On December 18, 2024, Blackstone Inc. (NYSE:BX) stock closed at $171.70 per share with a market capitalization of $208.25 billion.
RiverPark Large Growth Fund stated the following regarding Blackstone Inc. (NYSE:BX) in its Q3 2024 investor letter:
“Blackstone Inc. (NYSE:BX): Alternative asset manager Blackstone was a top contributor in the third quarter following a relatively weak second quarter earnings report but accompanied by an optimistic outlook. BX delivered Distributable Earnings (DE) of $0.96 per share, dividends of $0.82 per share, and Fee Related Earnings (FRE) of $0.91 per share, all slightly below investor expectations of $0.98, $0.83, and $0.90 respectively. Fee-related performance revenues (FRPR) of $177mn were also below investor expectations of $221 million. Management anticipates a material step-up in Q4 FRE, driven by Corporate PE and Energy flagships. In terms of net realizations, management expects a lag between improving markets and a pickup in these revenues.
Whatever the near-term brings for realizations, we continue to view Blackstone as offering an attractive risk/reward profile given its below-market valuation and consistent double-digit AUM growth driving recurring fee revenue growth, plus strong and consistent investment performance. Most of Blackstone’s capital is long-dated or even permanent, most of its fees (which are high-margin and recurring) are not sensitive to market fluctuations, and the company has billions of dollars of uninvested capital available to put to work. BX’s recurring fees provide a base of consistent earnings, while its opportunistic investing and harvesting add the ability to maximize investment returns, providing a strong foundation for long-term stock performance. Additionally, BX provides a 2% dividend yield at the current share price.”
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Blackstone Inc. (NYSE:BX) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 50 hedge fund portfolios held Blackstone Inc. (NYSE:BX) at the end of the third quarter which was 58 in the previous quarter. While we acknowledge the potential of Blackstone Inc. (NYSE:BX) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Blackstone Inc. (NYSE:BX) and shared the list of best asset management stocks to buy according to hedge funds. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.