/Bank%20Of%20New%20York%20Mellon%20Corp%20location%20sign-by%20JHVEPhoto%20via%20Shutterstock.jpg)
Valued at a market cap of $47.9 billion, The Bank of New York Mellon Corporation (BK) is a leading financial services company operating primarily in the investment services and asset management sectors. The New York-based company provides a wide range of financial products and services globally, catering to institutions, corporations, and high-net-worth individuals.
Shares of the custody banking giant have significantly outpaced the broader market over the past 52 weeks. BK has notably gained 46.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 24.9%. In 2024, shares of BK are up 24.8%, compared to SPX's 16.2% gain on a YTD basis.
Zooming in further, BK is also outpacing the S&P 500 Financials Sector SPDR's (XLF) 27% gain over the past 52 weeks and a 15.6% increase on a YTD basis.
BNY Mellon has outperformed over the past year due to increased net interest income from favorable rates and strong growth in assets under custody and management, coupled with improved fee income and cost efficiency. Furthermore, the stock surged 5.2% on Jul. 12 due to the company exceeding Wall Street's profit expectations for Q2 results, driven by a 5% rise in investment service fees despite a drop in interest income. Plus, the bank's assets under management increased by 7%, reflecting strong investor activity amid a U.S. market rally.
For the current fiscal year, ending in December, analysts expect BK's EPS to grow 11.1% year over year to $5.61. The company's earnings surprise history is promising. It beat the consensus estimates in each of the last four quarters.
Among the 17 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on nine “Strong Buy” ratings, one “Moderate Buy,” and seven “Holds.”
This configuration is slightly less bullish than three months ago, with 10 analysts suggesting a “Strong Buy.”
On Aug. 5, Barclays analyst Jason Goldberg maintained a “Buy” rating on BNY Mellon and set a price target of $75, which suggests a 15.4% potential upside from current levels.
The mean price target of $69.94 represents a premium of just 7.6% to BK's current levels. The street-high price target of $76 implies a modest potential upside of almost 16.9% from the current price levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
