Investment bank Oppenheimer goes against the trend by giving a strong buy recommendation for Blackstone (BX.US), stating that the market has "wrongly killed" the top franchise value.

Investment bank Oppenheimer has upgraded the stock rating of the private equity giant Blackstone Inc. (BX.US) from "hold" to "outperform the market," citing that despite the company's "outstanding" performance, especially in its real estate sector, the stock price has recently suffered a "sharp decline." Analyst Chris Kotowski highlighted the exceptional historical performance of this alternative asset management company since 2009 (when Oppenheimer began covering the company), particularly in its strength in the real estate sector. While this sector, along with private credit, is currently out of favor in the market, Oppenheimer believes that these concerns have been overblown. Kotowski stated, "One standout feature of Blackstone is its real estate business, which until recently has been its largest source of fee income," "In our view, its real estate business is unrivaled (with Field Corporation a distant second but still far behind), and has significant upside potential in the coming years." He also mentioned Blackstone's "asset-light" business model, which means that it does not directly own insurance subsidiaries and does not have a large balance sheet investment. Kotowski stated that as a result, almost all of the company's earnings are returned to shareholders. He wrote, "In short, the current market dislocation presents an attractive valuation opportunity for investors to buy into a top franchised operator in an industry that is extremely appealing."