Nomura Securities on Trust Banks: 4Q Wrap-Up - Story Is Mostly More of The Same
Tweet
Share
E-mailGet Alerts NTRS Hot Sheet
Price: $183.90 +0.76%
Rating Summary:
7 Buy, 15 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
7 Buy, 15 Hold, 3 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Join SI Premium – FREE
Nomura Securities on Trust Banks: 4Q Wrap-Up
Analyst, Glenn Schorr, said, "While disappointing on the revenue front, we think trust bank earnings in 4Q were mostly a similar story to the past few quarters. On the positive front, capital is still strong, they have showed OK asset growth, NII stability and improving cost control. Unfortunately, revenue softness is evident in several fee buckets across asset servicing and asset management and FX and other trading revenues were a drag. With the macro and capital markets backdrop remaining subdued, increased compliance costs & capital requirements, Sec Lending and FX not material contributors and having little NII wiggle room given the rate environment, the cost save initiatives are well timed, but can only do so much at this point. Despite an industry focus on expense initiatives to help support the bottom line and low valuations, we are maintaining our Neutral view on the sector."
Northern Trust (Nasdaq: NTRS): 2012E EPS from $3.00 to $2.90, 2013E from $3.35 to $3.30. TP from $42 to $41 (based on a target multiple of 14x our 2012E).
Bank of NY Mellon (NYSE: BK): 2012E EPS from $2.20 to $2.10, 2013E from $2.45 to $2.35. TP from $23 to $22 (based on a target multiple of 10.5x our 2012E)
State Street (NYSE: STT): 2012E EPS from $3.75 to $3.60, 2013E from $4.40 to $4.35. TP from $41 to $40 (based on a target multiple of 11x our 2012E).
Analyst, Glenn Schorr, said, "While disappointing on the revenue front, we think trust bank earnings in 4Q were mostly a similar story to the past few quarters. On the positive front, capital is still strong, they have showed OK asset growth, NII stability and improving cost control. Unfortunately, revenue softness is evident in several fee buckets across asset servicing and asset management and FX and other trading revenues were a drag. With the macro and capital markets backdrop remaining subdued, increased compliance costs & capital requirements, Sec Lending and FX not material contributors and having little NII wiggle room given the rate environment, the cost save initiatives are well timed, but can only do so much at this point. Despite an industry focus on expense initiatives to help support the bottom line and low valuations, we are maintaining our Neutral view on the sector."
Northern Trust (Nasdaq: NTRS): 2012E EPS from $3.00 to $2.90, 2013E from $3.35 to $3.30. TP from $42 to $41 (based on a target multiple of 14x our 2012E).
Bank of NY Mellon (NYSE: BK): 2012E EPS from $2.20 to $2.10, 2013E from $2.45 to $2.35. TP from $23 to $22 (based on a target multiple of 10.5x our 2012E)
State Street (NYSE: STT): 2012E EPS from $3.75 to $3.60, 2013E from $4.40 to $4.35. TP from $41 to $40 (based on a target multiple of 11x our 2012E).
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Walmart (WMT) PT Lowered to $130 at UBS on Investment Narrative's Competing Dynamics
- Singularity Future Technology closes $5M registered direct offering
- Is the global equity rally broadening? UBS weighs in
Create E-mail Alert Related Categories
Analyst CommentsRelated Entities
Nomura, EarningsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
