Update shared on 07 Nov 2025
Fair value Decreased 0.26%Northern Trust's analyst price target has been revised slightly lower to $134.50 from $134.86. Analysts factor in modest model adjustments reflecting small shifts in revenue expectations and profit margins following recent quarterly trends.
Analyst Commentary
Recent commentary reveals a spectrum of views on Northern Trust's outlook. Both bullish and bearish analysts highlight developments tied to the bank's model adjustments, valuation, and execution following recent quarterly results.
Bullish Takeaways
- Certain analysts remain constructive on wealth management. They emphasize its sustained strong growth and robust pre-tax margins as key drivers of valuation resilience.
- The slower-than-expected decline in net interest income and favorable reserve releases contributed to upward adjustments in some price targets.
- Solid activity levels and higher market valuations are expected to boost fee income, which could enhance potential revenue streams and support future growth.
- Historical growth in assets under custody and administration, especially in comparison to peers, continues to bolster confidence in Northern Trust's execution and market positioning.
Bearish Takeaways
- Bearish analysts express concerns over mixed quarterly performance. They note weaker servicing and slower core business growth that may limit near-term upside.
- Premium valuation is seen as potentially at risk if tangible improvements in efficiency or financial results do not materialize in the coming periods.
- Continued deregulatory themes and subdued capital markets activity are prompting cautious adjustments in estimates, which dampens optimism about near-term expansion.
- Interest rate headwinds could restrain earnings growth, particularly by sustaining pressure on net interest income.
What's in the News
- Northern Trust has decreased its prime rate to 7.00 percent, following earlier reductions from 7.25 percent and 7.50 percent in recent months (Periodicals).
- Truist lowered its price target for Northern Trust to $139 from $142, citing model adjustments after Q3 results. Slightly lower fee revenue was partially offset by a positive outlook for net interest income (Periodicals).
- Northern Trust expanded its fund services relationship with Avanda Investment Management to support the Monetary Authority of Singapore's Equity Market Development Programme. This move strengthens its presence in the Asian market (Key Developments).
- Completion of a share repurchase tranche, buying back 1,575,426 shares for $201.87 million, representing 0.82 percent of shares (Key Developments).
- Northern Trust has been appointed by the International Finance Facility for Education (IFFEd) to provide global custody services for a G20-endorsed education financing initiative (Key Developments).
Valuation Changes
- Consensus Analyst Price Target: Revised slightly lower to $134.50 from $134.86.
- Discount Rate: Increased modestly to 9.99 percent from 9.78 percent.
- Revenue Growth: Marginally decreased to 3.53 percent from 3.54 percent.
- Net Profit Margin: Increased to 21.26 percent from 21.24 percent.
- Future P/E: Increased slightly to 15.68x from 15.65x.
Disclaimer
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