Blackstone Group LP (BX-N)

Models $70 or 20% downside, but he thinks it will hit $43. The air is coming out of the balloon.

High real estate percentage in its portfolio. Likes the private equity space. Worried about commercial real estate amid higher interest rates, but not likely to take down the company. He owns KKR instead.

Still holds in income growth portfolio.
Was not expecting higher interest rates which has put pressure on company.
AUM still growing - $40 billion new cash in free funds to invest.
Expecting further growth going forward. 

Alternative assets are dominated by a few companies that have tremendous scale. Has really diversified beyond private equity. Caught up in market's concerns about real estate, but they're much less exposed than BN. Office represents just 2% of US real estate portfolio. 

Likely a difficult 6-18 months, but macro is close to rates peaking. Over $190B of dry powder. Best alt asset manager in the world. Can easily achieve over 15% growth in fee-related earnings over time. Yield is 3.52%. 

Trades at 15x PE as rates could hold for the rest of the year. Private equity companies do better when rates hold. Their portfolio and management are excellent.

Big exposure to real estate, but there are 2 sides to the coin. They are in the midst of it with the assets they already own, but these are fund-raising machines. Has about $90B in dry capital, which can be deployed in a depressed market.