Evercore says Blackstone redemptions set up ‘challenging’ session for group

Evercore ISI analyst Glenn Schorr notes that Blackstone’s (BX) perpetual, non-traded BDC, BCRED, reported that Q1 redemption requests totaled 7.9% of the outstanding shares, up from 4.5% in Q4, and BCRED will fulfill 100% of requests this quarter, even though repurchases exceeded both the 5% tender offer and the subsequently upsized 7% cap. The firm believes investors were not anticipating redemption requests approaching 8% and it expects the group will face “a challenging trading session,” adding that BCRED, the “category leader in private credit,” has “effectively raised the bar for all the other non-traded BDCs,” narrowly avoiding the potential backlash associated with gating redemptions. The firm keeps an Outperform rating and $170 price target on Blackstone shares, which are down 7% to $107.13 in morning trading.