Bank of America Securities analyst Ebrahim Poonawala has reiterated their bullish stance on NTRS stock, giving a Buy rating on January 18.
Ebrahim Poonawala has given a Buy rating to Northern Trust (NTRS) stock for several reasons. Despite the market’s cautious reception to Northern Trust’s fourth-quarter earnings, Poonawala recognizes the company’s strength in net interest income, which surpassed expectations. He also notes management’s guidance for net interest income in the first quarter of 2024, which is anticipated to be higher than previous estimates. Adjustments to the earnings per share forecasts for 2024 and 2025 have been nudged upward by approximately 2%, contributing to a positive outlook and a price objective increase from $92 to $93.
Furthermore, Poonawala believes that although Northern Trust is not a price setter in deposit rates and may face challenges in reducing deposit costs, the company has a solid wealth management franchise that is difficult to replicate. This positions Northern Trust favorably in the ultra-high net worth segment, where competition is intense. With strong execution and a commitment to efficiency improvements, as evidenced by management actions and the launch of the Productivity Office, Northern Trust is expected to outperform and achieve a premium valuation, justifying the Buy rating.
In another report released on January 18, RBC Capital also assigned a Buy rating to the stock with a $86.00 price target.
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Based on the recent corporate insider activity of 94 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of NTRS in relation to earlier this year.
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Northern (NTRS) Company Description:
Northern Trust Corp. is a financial holding company, which engages in the provision of asset servicing, fund administration, asset management, fiduciary, and banking solutions for corporations, institutions, families, and individuals. It operates through the following segments: Corporate & Institutional Services and Wealth Management. The Corporate & Institutional Services Segment offers asset servicing, brokerage, banking and related services to corporate and public retirement funds, foundations, endowments, fund managers, insurance companies, and sovereign wealth funds. The Wealth Management Segment includes trust, investment management, custody, and philanthropic services, financial consulting; guardianship and estate administration, family business consulting; family financial education, brokerage services and private and business banking. Northern Trust was founded in 1971 and is headquartered in Chicago, IL.
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