Northern Trust (NTRS) Shares Down 5.2% on Disappointing Earnings

Northern Trust Co. (NASDAQ:NTRS) was down 5.2% on Wednesday following a weaker than expected earnings announcement. The company traded as low as $91.73 and last traded at $94.21. Approximately 6,031,370 shares traded hands during trading, an increase of 414% from the average daily volume of 1,173,208 shares. The stock had previously closed at $99.38.

The asset manager reported $1.58 EPS for the quarter, missing the consensus estimate of $1.61 by ($0.03). Northern Trust had a return on equity of 15.02% and a net margin of 22.88%. The firm had revenue of $1.48 billion during the quarter, compared to analysts’ expectations of $1.52 billion. During the same period in the previous year, the firm earned $1.20 earnings per share. The firm’s quarterly revenue was up 9.4% compared to the same quarter last year.

The business also recently disclosed a quarterly dividend, which will be paid on Tuesday, January 1st. Shareholders of record on Friday, December 14th will be given a dividend of $0.55 per share. This represents a $2.20 dividend on an annualized basis and a yield of 2.36%. The ex-dividend date is Thursday, December 13th. Northern Trust’s payout ratio is currently 45.55%.

Northern Trust declared that its Board of Directors has initiated a share buyback plan on Tuesday, July 17th that authorizes the company to buyback 25,000,000 outstanding shares. This buyback authorization authorizes the asset manager to purchase shares of its stock through open market purchases. Shares buyback plans are generally an indication that the company’s management believes its shares are undervalued.

NTRS has been the topic of a number of research analyst reports. Deutsche Bank reduced their price objective on shares of Northern Trust from $116.00 to $115.00 and set a “hold” rating on the stock in a research report on Thursday, October 11th. BidaskClub downgraded shares of Northern Trust from a “sell” rating to a “strong sell” rating in a research report on Saturday, September 29th. Zacks Investment Research downgraded shares of Northern Trust from a “buy” rating to a “hold” rating in a research report on Wednesday, September 19th. Buckingham Research reduced their price objective on shares of Northern Trust from $119.00 to $114.00 and set a “neutral” rating on the stock in a research report on Thursday. Finally, Citigroup boosted their price objective on shares of Northern Trust from $108.00 to $118.00 and gave the company a “neutral” rating in a research report on Friday, July 20th. One analyst has rated the stock with a sell rating, eight have assigned a hold rating, eight have issued a buy rating and one has assigned a strong buy rating to the company’s stock. Northern Trust currently has a consensus rating of “Buy” and a consensus target price of $117.00.

In other news, CFO Biff Bowman sold 21,352 shares of the business’s stock in a transaction on Thursday, August 9th. The shares were sold at an average price of $111.11, for a total transaction of $2,372,420.72. The sale was disclosed in a legal filing with the SEC, which is accessible through the SEC website. Also, Vice Chairman William L. Morrison sold 13,886 shares of the business’s stock in a transaction on Monday, July 23rd. The shares were sold at an average price of $110.87, for a total transaction of $1,539,540.82. The disclosure for this sale can be found here. In the last 90 days, insiders have sold 67,864 shares of company stock worth $7,533,831. Company insiders own 1.04% of the company’s stock.

Several hedge funds have recently made changes to their positions in NTRS. Vulcan Value Partners LLC boosted its holdings in shares of Northern Trust by 56.6% during the 2nd quarter. Vulcan Value Partners LLC now owns 2,522,199 shares of the asset manager’s stock valued at $259,509,000 after buying an additional 911,176 shares in the last quarter. Millennium Management LLC boosted its stake in Northern Trust by 2,535.7% in the 1st quarter. Millennium Management LLC now owns 580,091 shares of the asset manager’s stock worth $59,825,000 after purchasing an additional 558,082 shares in the last quarter. Wells Fargo & Company MN boosted its stake in Northern Trust by 10.7% in the 2nd quarter. Wells Fargo & Company MN now owns 2,388,480 shares of the asset manager’s stock worth $245,751,000 after purchasing an additional 230,226 shares in the last quarter. Morgan Stanley boosted its stake in Northern Trust by 29.0% in the 2nd quarter. Morgan Stanley now owns 911,274 shares of the asset manager’s stock worth $93,762,000 after purchasing an additional 205,050 shares in the last quarter. Finally, Point72 Asset Management L.P. bought a new position in Northern Trust in the 2nd quarter worth about $20,728,000. Hedge funds and other institutional investors own 77.99% of the company’s stock.

The company has a market capitalization of $22.80 billion, a PE ratio of 19.64, a PEG ratio of 1.19 and a beta of 0.94. The company has a debt-to-equity ratio of 0.34, a quick ratio of 0.66 and a current ratio of 0.66.

Northern Trust Company Profile (NASDAQ:NTRS)

Northern Trust Corporation, a financial holding company, provides asset servicing, fund administration, asset management, fiduciary, and banking solutions for corporations, institutions, families, and individuals worldwide. It operates through Corporate & Institutional Services (C&IS) and Wealth Management segments.

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