By Peet Serfontein, Zimele Mbanjwa
BlackRock (BLK) is a multinational investment management company. Its primary activity is asset management, offering both institutional and retail investors a wide range of financial products and services.
The company has offices in more than 30 countries and serves clients in over 100 countries across the globe. Blackrock's largest geographical market is the Americas - contributing more than 65% to revenue.
Technically, the price is developing a symmetrical triangle pattern in an uptrend, which makes for an attractive investment opportunity (see the black converging trendlines on the main chart as well as the insert). This pattern generally indicates a period of consolidation before the price makes a significant move.
When a symmetrical triangle pattern forms during an uptrend, it is typically interpreted as a continuation pattern. This means that the prevailing uptrend is likely to continue once the pattern completes. The consolidation phase within the triangle shows that buyers and sellers are pausing before further price movement, but the existing upward momentum suggests that buyers are likely to regain control.
The stock is trading above its 200-day simple moving average (SMA) of $737, suggesting consistent buying interest.
Fading downside price momentum, according to the MACD indicator as well as the recent upwards trajectory of the on-balance volume indicator, is supportive of our bullish view.
Share Information
| Share Code | BLK |
|---|---|
| Industry | Financial Services |
| Market Capital (USD) | 114.78 billion |
| One Year Total Return | 16.87% |
| Return Year-to-Date | -4.99% |
| Current Price (USD) | 766.62 |
| 52 Week High (USD) | 845.00 |
| 52 Week Low (USD) | 596.18 |
| Financial Year End | December |
| The stock has seen strong growth so far this year. Several technical indicators are pointing to further upside. |
Consensus expectations
(Bloomberg)
| FY23 | FY24E | FY25E | FY26E | |
|---|---|---|---|---|
| Headline Earnings per Share (USD) | 37.77 | 41.29 | 46.52 | 52.05 |
| Growth (%) | 9.32 | 12.65 | 11.89 | |
| Dividend Per Share (USD) | 20.00 | 20.42 | 21.96 | 24.12 |
| Growth (%) | 2.11 | 7.54 | 9.85 | |
| Forward PE (times) | 18.57 | 16.48 | 14.73 | |
| Forward Dividend Yield (%) | 2.66 | 2.86 | 3.15 | |
| Earnings growth is expected to remain strong in the short to medium term. | ||||
Rationale
Technical Analysis:
Long-term fundamental view:
| Share Name and position | VVX - Take Profit Loss (Close the Position) | CVX - Take Profit (Close the Position) | BDX - Time to exit (Close the Position) |
|---|---|---|---|
| Entry | 45.19 | 147.89 | 239.07 |
| Current | 50.33 | 162.85 | 234.36 |
| Movement | 11.4% | 10.1% | -2.0% |
| We closed the trade early to lock in a profit and reduce exposure. | We closed the trade early to lock in a profit and reduce exposure. | The trade reached its recommend time exit of 24 April 2024. |
| Share Name and position | MS - Buy (Continue to hold) | KHC - Buy (Continue to hold) | PNW - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 89.14 | 37.16 | 73.02 |
| Current | 93.76 | 38.07 | 74.5 |
| Movement | 5.2% | 2.4% | 2.0% |
|
The development of a falling wedge pattern in an uptrend is encouraging. The stock is above the 200-day simple moving average. Upside price momentum is supportive.
Our profit target is $101, with a trailing stop-loss of $89. Exit the position around 14 August 2024. |
A price developing a base pattern remains attractive. The stock remains above its 200-day moving average. Upside price momentum is supportive.
Our profit target is $43, with a trailing stop-loss of $36.70. Exit the position around 14 August 2024. |
A developing symmetrical triangle remain remains of interest. The stock remains below its 200-day moving average, and we maintain our counter trend strategy. Upside price momentum is supportive.
Our profit target is $81, with a trailing stop-loss of $70. Exit the trade by 5 July 2024. |
