Northern Trust Q4 revenue beats on higher interest income

Overview

• Financial services firm reported Q4 revenue up 8%, beating analyst expectations

• Net interest income for Q4 beat analyst estimates

Outlook

• Northern Trust did not provide specific financial guidance for the current quarter or full year

Result Drivers

• TRUST FEE GROWTH - Mid-single-digit growth in trust fees contributed to positive operating leverage, per CEO Michael O’Grady

• NET INTEREST INCOME - Double-digit growth in net interest income supported revenue increase

• ASSET GROWTH - Increase in assets under management and custody driven by favorable markets and net new business

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 11 "hold" and 3 "sell" or "strong sell"

• The average consensus recommendation for the investment management & fund operators peer group is "buy."

• Wall Street's median 12-month price target for Northern Trust Corp is $143.00, about 1% below its January 21 closing price of $144.42

• The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 15 three months ago

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