almost 4 years ago • 2 mins
A promising first-quarter update from Blackstone on Thursday suggested the private equity titan is polishing an ugly situation into something altogether more appealing 😍
Blackstone reported earnings that were 4% higher than the same time last year. It turns out that the cash the firm made in fundraising and investment management fees over the quarter was more than enough to offset the damage last month’s selloff did to the values of its funds.
Blackstone’s not the only bright spot amid the coronavirus chaos, either: US retailer Target announced sales were up 7% so far in its first quarter, while its ecommerce revenues quadrupled in April. And Kimberly-Clark and Domino’s both reported their own rising sales last quarter – because and in spite of the pandemic respectively 📈
While Blackstone’s stock rose 5% on Thursday, the others’ didn’t follow suit. The difference might be their relative cash balances 💰: Blackstone is awash with money it can use to strike cut-price deals with under-pressure companies or real estate landlords – boosting its future profits – where Domino’s and Kimberly-Clark’s cash flows both look uncertain after they withdrew their earnings forecasts. And while Target’s growing its revenue, the retailer cautioned that higher costs and increased sales of less profitable products will lower its profit margin – and therefore weaken its cash flow.
The recent rise in global stock markets suggests investors are preparing for a relatively smooth economic recovery in the next few months, but there’s a risk they’re getting ahead of themselves. New data out on Thursday showed 4.4 million Americans newly filed for unemployment benefits last week, in addition to 16 million ongoing claimants 🇺🇸 And with the US government considering even more economic support, it might be a while before the world’s largest economy is out of the woods.
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