We are buying 15 shares of BlackRock at roughly $1,050. Following the trade, Jim Cramer’s Charitable Trust will own 60 shares of BLK, increasing its weighting to roughly 1.75% from 1.3%. Now that our trading restrictions are cleared, we can add to our position in the world’s largest asset manager. We initially wanted to buy shares last Tuesday after the company announced its $12 billion acquisition of HPS Investment Partners. The investment firm is a leader in private credit with $148 billion in assets under management (AUM), including $107 billion in fee-earning assets. The deal makes BlackRock a top five credit manager with about $220 billion in pro-forma private credit client assets. Growth in private credit assets has exploded over the past few years, and BlackRock sees this trend continuing through the rest of the decade, with traditional private credit AUM more than doubling. Some of the secular tailwinds driving the industry, according to BlackRock, are accelerating retail and institutional demand, insurance demand for investment-grade private debt, and sponsors increasingly preferring private debt. In addition, it’s an area that traditional banks have a tougher time expanding into because of their capital requirements. The deal is expected to close in the middle of 2025 and be accretive to BlackRock’s organic growth and adjusted earnings per share in its first full year. We also can make an argument that BlackRock’s buying spree into faster-growth opportunities like this and the recently closed GIP deal should help its price to earnings multiple re-rate from a traditional money managers to that of alternative managers, which generally get a higher valuation in the market. (Jim Cramer’s Charitable Trust is long BLK. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
