BlackRock stock price target lowered to $1,215 by KBW on margin pressure

Investing.com - BlackRock (NYSE:BLK) saw its price target reduced to $1,215 from $1,260 by Keefe, Bruyette & Woods on Wednesday, though the firm maintained its Outperform rating on the asset manager.

The price target adjustment followed BlackRock’s second-quarter earnings report, which beat estimates but was described by KBW as a "lower quality" beat primarily driven by higher non-operating income rather than core business strength.

BlackRock shares fell 5.9% after the earnings announcement, with investors reacting to a weaker base fee rate, lighter flows, and a lower adjusted operating margin compared to consensus expectations. KBW also noted that BlackRock’s compensation ratio likely needs to increase in the second half of the year.

Despite missing long-term flow expectations, BlackRock still achieved 6% annualized organic base fee growth, exceeding its 2030 goal of over 5%. This performance occurred as the company continues its broader transformation initiatives.

KBW slightly lowered its earnings estimates along with the price target reduction but remained constructive on BlackRock’s various growth initiatives, supporting its continued Outperform rating.

In other recent news, BlackRock Inc (BVMF:BLAK34). reported impressive financial results for the second quarter of 2025, with earnings per share (EPS) of $12.05, surpassing analyst expectations of $10.6. Revenue reached $5.42 billion, slightly above the anticipated $5.41 billion, marking a 13% year-over-year increase. The company also reported a record $12.5 trillion in assets under management, bolstered by organic base fee growth and net investment gains. Despite these strong financial results, BlackRock’s stock experienced a pre-market decline. The company continues to focus on strategic acquisitions and product innovations to support its growth. Analysts from Morgan Stanley (NYSE:MS) and Bank of America have shown interest in BlackRock’s strategies, particularly in integrating private markets into retirement plans and expanding in international markets. Additionally, BlackRock’s recent acquisitions, including HPS Investment Partners and Elmtree Funds, are part of its strategy to enhance its private markets and technology capabilities.

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