Everyone's Down on BlackRock. Here's Why I Love It
In the near term, financial markets will likely continue to swing sharply back and forth between gains and losses as the economy tries to right itself and get past the disruptions caused by the coronavirus pandemic. While this can cause investors to get caught up in a short-term trading mindset if they're not careful, it can also present great opportunities for the long run.
After a difficult 2022, the S&P 500 index has gained 4% so far to start off this year. But not all stocks have enjoyed these gains. Shares of the world's largest asset manager, BlackRock (NYSE: BLK), have shed 4% of their value year to date. This recent volatility arguably makes the stock a smart pick for long-term dividend growth investors. Let's assess BlackRock's fundamentals and valuation to elaborate further.
As you'd expect from an asset manager, BlackRock does exceptionally well in terms of both fundamentals (i.e., revenue growth) and stock performance during bull markets. This is because bull markets are characterized by business growth, which makes stocks more profitable and valuable over time. Asset managers earn revenue based on a percentage of the assets they manage, which is why BlackRock generates more in revenue and profits in a bull market than in a bear market.
Source Fool.com
