Is Now the Moment to Consider Selling Blackstone Shares as Private Credit Concerns Grow?

Blackstone Faces Mounting Challenges Amid Private Credit Turmoil

Blackstone Inc. (BX) has experienced a significant drop in its stock price, falling 28.2% over the last quarter, outpacing the broader industry’s 21.4% decline. This downturn has been fueled by growing unease in the private credit sector, persistent fund outflows, and broader economic headwinds.

Investor confidence took a hit after Blackstone’s flagship $82 billion private credit fund (BCRED) was confronted with a surge in redemption requests, with withdrawals surpassing the fund’s usual quarterly limits. This raised fresh concerns about the fund’s liquidity and the overall resilience of private credit vehicles. In response, Blackstone recently increased its redemption cap from 5% to 7% to better manage these outflows.

The spike in withdrawals has been largely attributed to recent high-profile bankruptcies and credit stress in industries like auto suppliers and subprime lending, which have heightened fears of loan defaults within private credit portfolios. Additionally, investors are wary of the fund’s exposure to software and technology borrowers, sectors facing uncertainty due to rapid advancements in artificial intelligence and slowing growth rates.

Rising bond yields and ongoing uncertainty around interest rates have also made leveraged buyouts and real estate investments—two of Blackstone’s core focus areas—less appealing, further contributing to the stock’s decline.

Broader Impact on Alternative Asset Managers

The turbulence in the private credit market has not been limited to Blackstone. Other major players, including BlackRock (BLK), Apollo Global (APO), and Blue Owl Capital Inc. (OWL), have also seen their shares slide, with losses of 13.1%, 28.1%, and 39.1% respectively over the past three months.

3-Month Price Performance

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Industry Responses and Investor Considerations

Recently, Blue Owl Capital imposed limits on withdrawals from one of its retail-focused funds. Apollo Global’s CEO, Marc Rowan, cautioned that the private credit industry is likely to face a shakeout as defaults among software borrowers rise. BlackRock has also restricted redemptions from its HPS Corporate Lending Fund following a spike in withdrawal requests.

Given these challenging conditions, investors are left to weigh whether to retain or exit their positions in Blackstone. Before making any decisions, it’s crucial to evaluate the company’s underlying fundamentals and future growth potential.

Assessing Blackstone’s Core Strengths

Strong Asset Growth

Blackstone boasts a robust asset base, with total assets under management (AUM) and fee-earning AUM growing at compound annual rates of 15.6% and 14.4%, respectively, over the past five years. By the end of 2025, total AUM had reached a record $1.27 trillion.

This growth has been propelled by steady capital inflows, strategic investments in high-growth sectors like infrastructure and technology, and successful fundraising initiatives. Blackstone’s focus on areas such as digital infrastructure, AI, energy transition, and life sciences has provided additional momentum. The company’s expansion into private wealth and insurance platforms, along with innovative products like perpetual vehicles, has helped diversify its revenue streams.

With a broad product lineup and a leading position in alternative investments, Blackstone is well-placed to continue expanding its AUM.

Impressive Fundraising Capabilities

Despite a tough fundraising environment, Blackstone has continued to attract capital. As of December 31, 2025, the firm had $198.3 billion in available capital (“dry powder”) for new investments. In 2024 and 2025, Blackstone deployed $133.9 billion and $138.2 billion, respectively, positioning itself to capitalize on market dislocations. The company also sees promising opportunities in markets like India and Japan.

In April 2025, Blackstone, Wellington, and Vanguard announced a partnership to create simplified multi-asset investment solutions, combining public and private markets to help investors achieve better diversification and returns.

Valuation Overview

Currently, Blackstone’s shares are trading at a premium compared to the industry average. The company’s forward 12-month price-to-earnings (P/E) ratio stands at 16.58, notably higher than the sector average of 9.76.

P/E (F12M) Ratio Comparison

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What’s Next for Blackstone Stock?

The company’s elevated valuation, coupled with tighter credit conditions, high interest rates, subdued deal activity, and concerns about exit opportunities, could weigh on Blackstone’s near-term outlook. While immediate credit losses are not the primary concern, ongoing uncertainty in the private credit market may continue to impact investor sentiment, redemption activity, and fundraising pace. This could put some pressure on AUM and fee-related earnings in the short run.

Analyst estimates for Blackstone’s earnings in 2026 and 2027 suggest year-over-year growth of 14% and 26.8%, respectively, but both projections have been revised downward in the past month, reflecting a more cautious outlook.

Earnings Estimate Trends

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Long-Term Perspective

Despite current challenges, Blackstone’s diversified business model—spanning private equity, real estate, credit, infrastructure, and hedge fund solutions—enables it to generate multiple revenue streams. Its strong reputation and deep institutional relationships are likely to support continued fund inflows and long-term growth in AUM and fee-based earnings.

For now, investors who are sensitive to valuation or risk may prefer to avoid new positions in BX stock. However, existing shareholders may choose to hold, as Blackstone’s long-term prospects remain intact. It will be important to monitor how private credit risks evolve and how the company responds strategically before making further investment decisions.