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BlackRock (BLK) Q4 Earnings Beat, Revenues & AUM Rise Y/Y

BlackRock, Inc.’s BLK fourth-quarter 2021 adjusted earnings of $10.42 per share outpaced the Zacks Consensus Estimate of $10.23. The figure reflects a rise of 2.4% from the year-ago quarter.

Results benefited from an improvement in revenues, partly offset by higher expenses. Moreover, long-term net inflows supported growth in assets under management (AUM) balance, which was a major positive for the company.

Net income attributable to BlackRock (on a GAAP basis) was $1.64 billion, up 6.1% from the prior-year quarter.

For 2021, the company reported adjusted earnings of $39.18 per share, which outpaced the Zacks Consensus Estimate of $39.04. The figure reflects a year-over-year rise of 15.8%. Net income attributable to BlackRock was $5.90 billion, up 19.6% from the prior year.

Revenues Improve, Expenses Rise

Quarterly revenues (on a GAAP basis) were $5.11 billion, increasing 14% year over year. The upside stemmed from an increase in almost all components of revenues, except for investment advisory performance fees. The figure lagged the Zacks Consensus Estimate of $5.21 billion.

Revenues for 2021 were $19.37 billion, increasing 19.6% year over year. The figure lagged the Zacks Consensus Estimate of $19.47 billion.

Total quarterly expenses amounted to $3.07 billion, up 16.6% from the year-ago period. The rise was due to an increase in all cost components.

Non-operating income (on a GAAP basis) was $71 million, down 77.7% from the year-ago quarter.

BlackRock’s adjusted operating income was $2.06 billion, up 11.3% from the prior-year period.

Net Inflows Support AUM Growth

As of Dec 31, 2021, AUM totaled $10.01 trillion, reflecting a year-over-year jump of 15.4%. In the reported quarter, the company witnessed long-term net inflows of $169 billion.

Capital Deployment Update

BlackRock repurchased shares worth $1.2 billion in 2021.

Concurrent with the earning release, the company announced a quarterly dividend of $4.88 per share, representing a hike of 18% from the prior payout. The dividend will be paid out on Mar 23 to shareholders of record as of Mar 7.

Our Viewpoint

The company’s continued efforts to strengthen the iShares and ETF operations, along with its initiatives to restructure the actively-managed equity business, are expected to continue boosting the top line and AUM in the days to come. However, rising expenses (as witnessed in the fourth quarter as well) will likely hurt the bottom line to some extent.

BlackRock, Inc. Price, Consensus and EPS Surprise

BlackRock, Inc. Price, Consensus and EPS Surprise
BlackRock, Inc. Price, Consensus and EPS Surprise

BlackRock, Inc. price-consensus-eps-surprise-chart | BlackRock, Inc. Quote

BlackRock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Release Schedule of Other Asset Managers

We now look forward to the earnings releases of Federated Hermes, Inc. FHI and Invesco Ltd. IVZ.

Invesco is scheduled to report fourth-quarter results on Jan 25, whereas Federated Hermes will post the quarterly numbers on Jan 27.

IVZ currently carries a Zacks Rank #2 (Buy). FHI sports a Zacks Rank #1 at present.


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