The Bull Case For Bank of New York Mellon (BK) Could Change Following New AI Partnership With Carnegie Mellon

• Carnegie Mellon University and BNY Mellon recently announced a five-year, US$10 million partnership to launch the BNY AI Lab, which will drive artificial intelligence research, talent development, and industry collaboration with a dedicated facility on CMU’s Pittsburgh campus.
• This collaboration not only targets advanced AI solutions for financial services but also places BNY Mellon in a unique position to recruit top AI talent and shape the governance of emerging technologies in its sector.
• We'll explore how BNY Mellon's partnership for AI research and talent development could influence its investment narrative and technology ambitions.

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Bank of New York Mellon Investment Narrative Recap

To be a shareholder in Bank of New York Mellon, you need to believe in the firm's ability to harness long-term institutional asset growth, scale technology and digital solutions, and benefit from strong client demand for evolving financial services. The recent $10 million, five-year AI partnership with Carnegie Mellon University may support medium- to long-term differentiation in digital operations, but it is unlikely to materially change the most important short-term catalyst, continued organic fee revenue growth, or address the biggest immediate risk of persistent net outflows in investment management.

Among several recent announcements, BNY Mellon's expanded role as Ripple's USD reserve custodian stands out for reinforcing the firm’s position in digital asset infrastructure. This aligns directly with the ongoing catalyst of accelerated client adoption in digital custody, supporting resilience as digital finance trends expand.

Yet, investors should keep in mind that despite these milestones, operational efficiency benefits from new technology and AI investments are still years away, and if execution falls short…

Read the full narrative on Bank of New York Mellon (it's free!)

Bank of New York Mellon's outlook anticipates $21.3 billion in revenue and $5.8 billion in earnings by 2028. This is based on an expected annual revenue growth rate of 3.4% and represents a $1.0 billion increase in earnings from the current $4.8 billion.

Uncover how Bank of New York Mellon's forecasts yield a $102.27 fair value, a 4% downside to its current price.

Exploring Other Perspectives

Simply Wall St Community members provided five fair value estimates for BNY Mellon between US$70.50 and US$108.16. While individual viewpoints vary, the push into AI through CMU partnerships may reshape long-term operational efficiency and investor expectations for future earnings growth.

Explore 5 other fair value estimates on Bank of New York Mellon - why the stock might be worth as much as $108.16!

Build Your Own Bank of New York Mellon Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Bank of New York Mellon research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Bank of New York Mellon research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Bank of New York Mellon's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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