NasdaqGS:NTRS

Stock Analysis Report

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Executive Summary

Northern Trust Corporation, a financial holding company, provides wealth management, asset servicing, asset management, and banking solutions for corporations, institutions, families, and individuals worldwide. More Details


Snowflake Analysis

Flawless balance sheet established dividend payer.


Similar Companies

Share Price & News

How has Northern Trust's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NTRS is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: NTRS's weekly volatility (4%) has been stable over the past year.


Market Performance


7 Day Return

-0.2%

NTRS

-1.0%

US Capital Markets

-2.4%

US Market


1 Year Return

20.6%

NTRS

38.3%

US Capital Markets

31.2%

US Market

Return vs Industry: NTRS underperformed the US Capital Markets industry which returned 38.3% over the past year.

Return vs Market: NTRS underperformed the US Market which returned 31.2% over the past year.


Shareholder returns

NTRSIndustryMarket
7 Day-0.2%-1.0%-2.4%
30 Day5.9%2.7%-3.0%
90 Day2.9%12.8%3.2%
1 Year24.8%20.6%41.7%38.3%34.1%31.2%
3 Year-2.3%-9.5%37.4%27.2%48.1%38.6%
5 Year71.8%53.4%150.0%118.9%116.5%92.3%

Long-Term Price Volatility Vs. Market

How volatile is Northern Trust's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Northern Trust undervalued compared to its fair value and its price relative to the market?

7.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NTRS ($97.57) is trading below our estimate of fair value ($105.88)

Significantly Below Fair Value: NTRS is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: NTRS is good value based on its PE Ratio (17.8x) compared to the US Capital Markets industry average (23.8x).

PE vs Market: NTRS is good value based on its PE Ratio (17.8x) compared to the US market (21x).


Price to Earnings Growth Ratio

PEG Ratio: NTRS is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: NTRS is good value based on its PB Ratio (1.9x) compared to the US Capital Markets industry average (16.7x).


Next Steps

Future Growth

How is Northern Trust forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

7.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NTRS's forecast earnings growth (7.5% per year) is above the savings rate (2%).

Earnings vs Market: NTRS's earnings (7.5% per year) are forecast to grow slower than the US market (19.5% per year).

High Growth Earnings: NTRS's earnings are forecast to grow, but not significantly.

Revenue vs Market: NTRS's revenue (4.7% per year) is forecast to grow slower than the US market (10.1% per year).

High Growth Revenue: NTRS's revenue (4.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NTRS's Return on Equity is forecast to be low in 3 years time (14.9%).


Next Steps

Past Performance

How has Northern Trust performed over the past 5 years?

8.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NTRS has high quality earnings.

Growing Profit Margin: NTRS's current net profit margins (19.1%) are lower than last year (23.5%).


Past Earnings Growth Analysis

Earnings Trend: NTRS's earnings have grown by 8.7% per year over the past 5 years.

Accelerating Growth: NTRS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: NTRS had negative earnings growth (-20.1%) over the past year, making it difficult to compare to the Capital Markets industry average (10.4%).


Return on Equity

High ROE: NTRS's Return on Equity (10.3%) is considered low.


Next Steps

  • Explore strong past performing companies in the Diversified Financials industry.

Financial Health

How is Northern Trust's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet


Financial Institutions Analysis

Asset Level: NTRS's Assets to Equity ratio (14.5x) is moderate.

Allowance for Bad Loans: NTRS has a sufficient allowance for bad loans (151%).

Low Risk Liabilities: 91% of NTRS's liabilities are made up of primarily low risk sources of funding.

Loan Level: NTRS has an appropriate level of Loans to Assets ratio (20%).

Low Risk Deposits: NTRS's Loans to Deposits ratio (23%) is appropriate.

Level of Bad Loans: NTRS has an appropriate level of bad loans (0.4%).


Next Steps

Dividend

What is Northern Trust current dividend yield, its reliability and sustainability?

2.87%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: NTRS's dividend (2.87%) is higher than the bottom 25% of dividend payers in the US market (1.34%).

High Dividend: NTRS's dividend (2.87%) is low compared to the top 25% of dividend payers in the US market (3.72%).


Stability and Growth of Payments

Stable Dividend: NTRS's dividends per share have been stable in the past 10 years.

Growing Dividend: NTRS's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (51.1%), NTRS's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NTRS's dividends in 3 years are forecast to be well covered by earnings (37% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.2yrs

Average management tenure


CEO

Mike O’Grady (54 yo)

3.17yrs

Tenure

US$9,459,768

Compensation

Mr. Michael G. O'Grady, also known as Mike, has been the Chairman of the Board at Northern Trust Corporation and Northern Trust Company since January 23, 2019. Mr. O'Grady has been the President and Chief ...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD9.46M) is about average for companies of similar size in the US market ($USD10.58M).

Compensation vs Earnings: Mike's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Michael O’Grady
Chairman3.17yrsUS$9.46m0.066%
$ 13.6m
Robert Browne
Executive VP & Chief Investment Officer12.17yrsUS$3.87m0.0083%
$ 1.7m
Steven Fradkin
Executive VP & President of Wealth Management18.17yrsUS$6.20m0.085%
$ 17.4m
Peter Cherecwich
Executive VP and President of Corporate & Institutional Services14.17yrsUS$4.47m0.022%
$ 4.6m
Jason Tyler
CFO & Executive VP1.17yrsno data0.0096%
$ 2.0m
Ian Headon
Head of Depositary Regulatory & Technical Servicesno datano datano data
Thomas South
Executive VP & Chief Information Officer3.17yrsno data0.0053%
$ 1.1m
Mark Bette
Senior VP & Director of Investor Relationsno datano datano data
Susan Levy
Executive VP6.83yrsno data0.026%
$ 5.3m
K. Mannard
Chief Marketing & Communications Officerno datano datano data
Stephanie Goforth
Executive VP and Global Head of Sales & Marketing0.083yrno datano data
Joyce St. Clair
Executive VP & Chief Human Resources Officer3.17yrsno datano data

3.2yrs

Average Tenure

55yo

Average Age

Experienced Management: NTRS's management team is considered experienced (3.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Michael O’Grady
Chairman3.17yrsUS$9.46m0.066%
$ 13.6m
Hidehiro Nakayama
President & Representative Director of Northern Trust Global Investments Japan8.75yrsno datano data
Martin Slark
Independent Director9.92yrsUS$240.75k0.0080%
$ 1.6m
Susan Crown
Independent Director24.17yrsUS$231.95k0.17%
$ 35.7m
Linda Bynoe
Independent Director14.92yrsUS$234.95k0.00096%
$ 197.1k
David H. Smith
Independent Director10.92yrsUS$254.95k0.66%
$ 135.5m
Charles Tribbett
Independent Director16.17yrsUS$234.95k0.00048%
$ 98.5k
Thomas Richards
Independent Director5.67yrsUS$229.95k0.0059%
$ 1.2m
R. Magill
Vice Chairman for Wealth Management2.17yrsno datano data
Dean Harrison
Independent Director6.17yrsUS$250.29k0.00050%
$ 102.6k
Jose Prado Becerra
Independent Director8.42yrsUS$223.05k0.00093%
$ 190.9k
Jay Henderson
Independent Lead Director1.92yrsUS$257.19k0.0036%
$ 730.8k

8.6yrs

Average Tenure

64.5yo

Average Age

Experienced Board: NTRS's board of directors are considered experienced (8.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: NTRS insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Northern Trust Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Northern Trust Corporation
  • Ticker: NTRS
  • Exchange: NasdaqGS
  • Founded: 1889
  • Industry: Asset Management and Custody Banks
  • Sector: Diversified Financials
  • Market Cap: US$20.529b
  • Shares outstanding: 208.31m
  • Website: https://www.northerntrust.com

Number of Employees


Location

  • Northern Trust Corporation
  • 50 South La Salle Street
  • Chicago
  • Illinois
  • 60603
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NTRSNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJan 1969
NT4DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1969
NTRS *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1969
0K91LSE (London Stock Exchange)YesCommon StockGBUSDJan 1969
NTRS.ONasdaqGS (Nasdaq Global Select)4.7% DP SH PF EUSUSDOct 2019
N1TR34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 COMBRBRLJan 2020

Biography

Northern Trust Corporation, a financial holding company, provides wealth management, asset servicing, asset management, and banking solutions for corporations, institutions, families, and individuals world...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/03/04 23:31
End of Day Share Price2021/03/04 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.