NYSE:BK

Stock Analysis Report

Executive Summary

The Bank of New York Mellon Corporation provides a range of financial products and services to institutions, corporations, and high net worth individuals in the United States and internationally.

Rewards

PE ratio (12.9x) is below the US market (18.5x)

Risk Analysis

Earnings are forecast to decline by an average of -6% per year for the next 3 years

Unstable dividend track record



Snowflake Analysis

Flawless balance sheet average dividend payer.


Similar Companies

Share Price & News

How has Bank of New York Mellon's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: BK has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.4%

BK

0.5%

US Capital Markets

-0.3%

US Market


1 Year Return

4.0%

BK

20.1%

US Capital Markets

18.6%

US Market

Return vs Industry: BK underperformed the US Capital Markets industry which returned 20.1% over the past year.

Return vs Market: BK underperformed the US Market which returned 18.6% over the past year.


Shareholder returns

BKIndustryMarket
7 Day1.4%0.5%-0.3%
30 Day0.9%5.4%2.2%
90 Day9.1%7.6%5.6%
1 Year6.6%4.0%22.4%20.1%21.1%18.6%
3 Year8.6%2.1%39.5%31.6%45.6%36.2%
5 Year36.9%24.3%84.0%66.9%71.1%52.2%

Price Volatility Vs. Market

How volatile is Bank of New York Mellon's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Bank of New York Mellon undervalued compared to its fair value and its price relative to the market?

12.87x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: BK ($49.64) is trading above our estimate of fair value ($46.61)

Significantly Below Fair Value: BK is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: BK is good value based on its PE Ratio (12.9x) compared to the Capital Markets industry average (33.2x).

PE vs Market: BK is good value based on its PE Ratio (12.9x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: BK's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: BK is good value based on its PB Ratio (1.2x) compared to the US Capital Markets industry average (6.3x).


Next Steps

Future Growth

How is Bank of New York Mellon forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

-6.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BK's earnings are forecast to decline over the next 3 years (-6% per year).

Earnings vs Market: BK's earnings are forecast to decline over the next 3 years (-6% per year).

High Growth Earnings: BK's earnings are forecast to decline over the next 3 years.

Revenue vs Market: BK's revenue (0.1% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: BK's revenue (0.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: BK's Return on Equity is forecast to be low in 3 years time (10.1%).


Next Steps

Past Performance

How has Bank of New York Mellon performed over the past 5 years?

9.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: BK has high quality earnings.

Growing Profit Margin: BK's current net profit margins (23.5%) are lower than last year (27%).


Past Earnings Growth Analysis

Earnings Trend: BK's earnings have grown by 9.9% per year over the past 5 years.

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

Earnings vs Industry: BK had negative earnings growth (-15.2%) over the past year, making it difficult to compare to the Capital Markets industry average (20.6%).


Return on Equity

High ROE: BK's Return on Equity (9.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Bank of New York Mellon'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

Inventory Level: BK has a low level of unsold assets or inventory.

Debt Coverage by Assets: BK's debt is covered by short term assets (assets are 2.4x debt).


Financial Institutions Analysis

Asset Level: BK's level of assets compared to its equity is low.

Allowance for Bad Loans: BK has a sufficient allowance for bad loans.

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

Loan Level: BK has an acceptable proportion of non-loan assets held.

Low Risk Deposits: BK's loans are broadly funded by customer deposits.

Level of Bad Loans: BK has an appropriate level of bad loans (0.16%)


Next Steps

Dividend

What is Bank of New York Mellon's current dividend yield, its reliability and sustainability?

2.50%

Current Dividend Yield


Dividend Yield vs Market

company2.5%marketbottom25%1.4%markettop25%3.7%industryaverage1.9%forecastin3Years2.6%

Current dividend yield vs market & industry

Notable Dividend: BK's dividend (2.5%) is higher than the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: BK's dividend (2.5%) is low compared to the top 25% of dividend payers in the US market (3.7%).


Stability and Growth of Payments

Stable Dividend: BK's dividend payments have been volatile in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (29.8%), BK's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: BK's dividends in 3 years are forecast to be well covered by earnings (31.4% payout ratio).


Next Steps

Management

What is the CEO of Bank of New York Mellon's salary, the management and board of directors tenure and is there insider trading?

1.9yrs

Average management tenure


CEO

Todd Gibbons (62yo)

0.3yrs

Tenure

US$7,446,178

Compensation

Mr. Thomas P. Gibbons, also known as Todd, has been an Interim Chief Executive Officer and Director of Bank of New York Mellon Corporation since September 27, 2019. Mr. Gibbons served as Chief Executive O ...


CEO Compensation Analysis

Compensation vs Market: Todd's total compensation ($USD7.45M) is below average for companies of similar size in the US market ($USD11.01M).

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


Management Age and Tenure

1.9yrs

Average Tenure

58yo

Average Age

Experienced Management: BK's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Age and Tenure

3.1yrs

Average Tenure

62yo

Average Age

Experienced Board: BK's board of directors are considered experienced (3.1 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$2,229,95018 Oct 19
Mitchell Harris
EntityIndividual
Role
Senior Key Executive
Senior EVP & CEO of Investment Management
Shares50,000
Max PriceUS$44.60
BuyUS$509,92122 Jul 19
William Daley
EntityIndividual
Shares11,350
Max PriceUS$44.93
SellUS$31,157,37706 May 19
Trian Fund Management, L.P.
EntityCompany
Shares621,807
Max PriceUS$50.12
SellUS$1,235,73002 May 19
Jane McCarthy
EntityIndividual
Role
Chief Legal Officer
Senior EVP & General Counsel
Shares25,000
Max PriceUS$49.43
SellUS$41,262,28413 Mar 19
Trian Fund Management, L.P.
EntityCompany
Shares792,000
Max PriceUS$52.28
SellUS$307,25805 Mar 19
Kurtis Kurimsky
EntityIndividual
Shares5,797
Max PriceUS$53.00
SellUS$247,67520 Feb 19
Charles Scharf
EntityIndividual
Shares4,674
Max PriceUS$52.99
SellUS$1,201,28320 Feb 19
Bridget Engle
EntityIndividual
Role
Chief Information Officer
Senior Executive VP & Chief Information Officer
Shares22,670
Max PriceUS$52.99
SellUS$112,681,92929 Jan 19
Trian Fund Management, L.P.
EntityCompany
Shares2,107,000
Max PriceUS$53.64

Ownership Breakdown

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


Management Team

  • Brian Ruane

    CEO of BNY Mellon Government Securities Services Corp. and Clearance & Collateral Management

    • Tenure: 2.5yrs
  • Mitchell Harris (64yo)

    Senior EVP & CEO of Investment Management

    • Tenure: 8.6yrs
    • Compensation: US$8.88m
  • Mark Musi

    Chief Compliance & Ethics Officer

    • Tenure: 0yrs
  • Todd Gibbons (62yo)

    Interim CEO & Director

    • Tenure: 0.3yrs
    • Compensation: US$7.45m
  • Jane McCarthy (54yo)

    Senior EVP & General Counsel

    • Tenure: 5.7yrs
  • O'Connor Engle (55yo)

    Senior Executive VP & Chief Information Officer

    • Tenure: 2.5yrs
    • Compensation: US$5.58m
  • Mike Santomassimo (44yo)

    Senior EVP & CFO

    • Tenure: 1.9yrs
    • Compensation: US$2.61m
  • Lester Owens (61yo)

    Senior EVP & Head of Operations

    • Tenure: 0.8yrs
  • Sabet Elias

    Chief Technology Officer

    • Tenure: 1.2yrs
  • Magda Palczynska

    Global Head of Investor Relations

    • Tenure: 0.8yrs

Board Members

  • Steve Black (67yo)

    Independent Director

    • Tenure: 1.7yrs
    • Compensation: US$212.46k
  • Ted Kelly (73yo)

    Independent Director

    • Tenure: 12.4yrs
    • Compensation: US$279.96k
  • Sam Scott (75yo)

    Independent Director

    • Tenure: 12.4yrs
    • Compensation: US$270.79k
  • Jeffrey Goldstein (64yo)

    Independent Director

    • Tenure: 5.7yrs
    • Compensation: US$269.96k
  • Linda Cook (61yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$249.96k
  • John Hinshaw (49yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$269.96k
  • Todd Gibbons (62yo)

    Interim CEO & Director

    • Tenure: 0.3yrs
    • Compensation: US$7.45m
  • Liz Robinson (50yo)

    Independent Director

    • Tenure: 3.2yrs
    • Compensation: US$374.96k
  • Joe Echevarria (62yo)

    Independent Chairman of the Board

    • Tenure: 0.3yrs
    • Compensation: US$329.96k
  • Jennifer Morgan (48yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$249.96k

Company Information

The Bank of New York Mellon Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Bank of New York Mellon Corporation
  • Ticker: BK
  • Exchange: NYSE
  • Founded: 1784
  • Industry: Asset Management and Custody Banks
  • Sector: Diversified Financials
  • Market Cap: US$44.376b
  • Shares outstanding: 922.20m
  • Website: https://www.bnymellon.com

Number of Employees


Location

  • The Bank of New York Mellon Corporation
  • 240 Greenwich Street
  • New York
  • New York
  • 10286
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BKNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1969
BN9DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1969
BK *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1969
0HLQLSE (London Stock Exchange)YesCommon StockGBUSDJan 1969
BN9ETLX (Eurotlx)YesCommon StockITEURJan 1969
BONYWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1969
BK.PRCNYSE (New York Stock Exchange)DP1/4000 PFD-CUSUSDSep 2012
A1HK20DB (Deutsche Boerse AG)PERP JR D NT4.5%DEUSDMay 2013
BONY34BOVESPA (Bolsa de Valores de Sao Paulo)EACH BDR REPR 1 COM STK USD0.01BRBRLAug 2015

Biography

The Bank of New York Mellon Corporation provides a range of financial products and services to institutions, corporations, and high net worth individuals in the United States and internationally. The compa ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/08 00:06
End of Day Share Price2019/12/06 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.