BlackRock Earnings Call Analysis: BLK Analysis to Kick Off the Unofficial Start of Earnings Season

Today was the unofficial start to earnings season. What stood out in Amenity Viewer from the calls this morning? Let's explore with BlackRock.

We Saw a Significant Downtick at BlackRock, With an Amenity Score of 0 vs 31 Last Quarter

With Amenity Viewer, we go beyond the score to understand the underlying drivers of the weakness.

A quick dive into the Key Drivers in the transcript itself revealed several headwinds

"We also saw accelerated de-risking by many clients in an environment marked by continuing trade tensions, a further slowdown in emerging markets and the steepening yield curve."

"Cyclical and secular headwinds impacting today's asset management business."

"Political instability in certain markets is increasing."

"Emerging markets and commodities remain under pressure."

"Investors worldwide are taking a defensive posture highlighted by the market volatility we saw last week."

"Asset management industry flows overall has slowed considerably."

It's never all negative. The offsets were highlighted by: data solutions, ETFs, and ESG

"Overall demand remains strong for our full range of technology solutions."

"Global iShares generated quarterly net inflows of $34 billion, driven by continued strong demand from long-term investors in our core franchise."

"Demand has risen (for fixed income ETFs) as investors gain more confidence in their benefits and simplicity"

"Sustainable investing for ESG is another area where an increasing demand from clients globally, coupled with BlackRock's investment in technology expertise is driving large-scale momentum."

Join the Amenity Viewer Beta Program today to analyze earnings call transcriptions and enable you to spot outliers, identify critical insights, and understand key drivers.

This communication does not represent investment advice. Transcript text provided by S&P Global Market Intelligence.

Copyright ©2019. All rights reserved.

November 26, 2019

Deception Spotlight: Smucker Jammed on Revenue Growth

We highlight The J. M. Smucker Company (SJM) following the company’s 2Q20 earnings call on 22 November 2019. Despite beating EPS estimates, the underlying story remains unsettling. Focusing more on the longer-term, our analysis finds questions about revenue have triggered deceptive answers by management in earnings calls at an increasing rate, which may further erode confidence given the ongoing calls for top-line improvements. This sort of evidence may provide fodder for bear theses and be a honeypot for activists. We narrate the context for our concern and detail deceptive language detected by Amenity’s NLP models.
November 21, 2019

Amenity Portfolio Analytics: Warren Buffett's Portfolio at Berkshire Hathaway

We pilot a method for using Amenity's NLP solutions to analyze earnings calls for multiple companies and scoring their impact on portfolios of diverse, unevenly distributed holdings. We analyze Warren Buffett's holdings at Berkshire Hathaway as a test case and detail the Oracle of Omaha's Amenity Portfolio Score with attribution at the position level. We find that Berkshire Hathaway's portfolio score is significantly greater than the average company score in our universe (>12k companies, >10 years), which is a function of Buffett favoring companies with positive Amenity Scores.
October 30, 2019

Ahead of the Fed: S&P 500 Bank Barometer

We’re back on Fed Watch! With the Federal Reserve’s Open Market Committee expected to announce another rate decision at 2pm on 30 October 2019, markets have baked in more than a 90% likelihood of a 25 basis point cut. We've kept a close eye on regional and diversified banks as earnings season progresses to gauge how lower rates are impacting management commentary as well as their business and economic implications. We share our analysis context ahead of the Fed’s announcement and press conference.
October 24, 2019

Sizing-Up New CEOs at Nike & Under Armour

Under Armour and Nike announced recently that their current CEOs are stepping aside and handing over control to the next generation of apparel giant leaders. Both successors have extensive experience in the upper echelons of corporate management. And as a result, we have both incoming CEOs on the proverbial record. We use Amenity’s suite of NLP tools below to analyze and estimate the level of clarity we can expect from Patrik Frisk and John Donahoe when they take the reins.

Stay Informed: Join Our Newsletter

Keep up to date with our analyses and how we're making changes.