Blackstone, Fortress estimates cut by BofA

Banc of America Securities LLC has cut its earnings estimate and price targets on Blackstone Group LP and Fortress Investment Group, citing challenging market conditions, according to a Reuters report. The New York-based investment banking subsidiary of Charlotte, N.C.-based Bank of America Corp. cut second-quarter earnings estimates on New York-based Blackstone to 5 cents from 17 cents per share, and Fortress to 11 cents from 15 cents per share. It also cut the price target on Blackstone to $21.30 from $22.50 and on Fortress to $20.10 from $21. “New financial sponsor deals continue to be light as are deal exits ... One bright spot for the second quarter is industry hedge fund returns,” analyst Michael Hecht said in a note to clients. Banc of America Securities expected Fortress to perform better then Blackstone in the near term because hedge fund earnings are likely to hold up better than private equity and new deals, the note said. Fortress gets half of its earnings from its hedge fund business, compared to 15% to 20% for Blackstone.