NORTHERN TRUST CORP (NTRS) Stock Fundamental Analysis
NASDAQ:NTRS - Nasdaq - US6658591044 - Common Stock - Currency: USD
Overall NTRS gets a fundamental rating of 4 out of 10. We evaluated NTRS against 232 industry peers in the Capital Markets industry. NTRS has a medium profitability rating, but doesn't score so well on its financial health evaluation. NTRS has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
NTRS had positive earnings in the past year.
In the past year NTRS had a positive cash flow from operations.
In the past 5 years NTRS has always been profitable.
NTRS had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
NTRS's Return On Assets of 1.30% is on the low side compared to the rest of the industry. NTRS is outperformed by 61.21% of its industry peers.
With an excellent Return On Equity value of 16.68%, NTRS belongs to the best of the industry, outperforming 81.03% of the companies in the same industry.
The Return On Invested Capital of NTRS (1.41%) is worse than 69.40% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NTRS is significantly below the industry average of 7.85%.
The 3 year average ROIC (1.06%) for NTRS is below the current ROIC(1.41%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.3% | ||
| ROE | 16.68% | ||
| ROIC | 1.41% |
ROA(3y)0.93%
ROA(5y)0.86%
ROE(3y)11.89%
ROE(5y)11.57%
ROIC(3y)1.06%
ROIC(5y)0.96%
1.3 Margins
The Profit Margin of NTRS (14.25%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of NTRS has declined.
NTRS has a Operating Margin (20.26%) which is in line with its industry peers.
NTRS's Operating Margin has declined in the last couple of years.
NTRS has a better Gross Margin (56.93%) than 65.52% of its industry peers.
NTRS's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.26% | ||
| PM (TTM) | 14.25% | ||
| GM | 56.93% |
OM growth 3Y-16.14%
OM growth 5Y-8.62%
PM growth 3Y-17.54%
PM growth 5Y-9.62%
GM growth 3Y-18.4%
GM growth 5Y-9.82%
2. Health
2.1 Basic Checks
The number of shares outstanding for NTRS has been reduced compared to 1 year ago.
The number of shares outstanding for NTRS has been reduced compared to 5 years ago.
Compared to 1 year ago, NTRS has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of -0.61, we must say that NTRS is in the distress zone and has some risk of bankruptcy.
NTRS has a worse Altman-Z score (-0.61) than 82.76% of its industry peers.
The Debt to FCF ratio of NTRS is 50.48, which is on the high side as it means it would take NTRS, 50.48 years of fcf income to pay off all of its debts.
NTRS's Debt to FCF ratio of 50.48 is in line compared to the rest of the industry. NTRS outperforms 41.81% of its industry peers.
NTRS has a Debt/Equity ratio of 11.43. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 11.43, NTRS is doing worse than 91.81% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 11.43 | ||
| Debt/FCF | 50.48 | ||
| Altman-Z | -0.61 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
A Current Ratio of 0.03 indicates that NTRS may have some problems paying its short term obligations.
NTRS's Current ratio of 0.03 is on the low side compared to the rest of the industry. NTRS is outperformed by 95.69% of its industry peers.
A Quick Ratio of 0.03 indicates that NTRS may have some problems paying its short term obligations.
NTRS's Quick ratio of 0.03 is on the low side compared to the rest of the industry. NTRS is outperformed by 95.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.03 | ||
| Quick Ratio | 0.03 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 27.58% over the past year.
NTRS shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.76% yearly.
NTRS shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.93%.
Measured over the past years, NTRS shows a quite strong growth in Revenue. The Revenue has been growing by 18.02% on average per year.
EPS 1Y (TTM)27.58%
EPS 3Y2.26%
EPS 5Y2.76%
EPS Q2Q%12.43%
Revenue 1Y (TTM)23.93%
Revenue growth 3Y33.14%
Revenue growth 5Y18.02%
Sales Q2Q%5.23%
3.2 Future
The Earnings Per Share is expected to grow by 5.70% on average over the next years.
The Revenue is expected to grow by 4.02% on average over the next years.
EPS Next Y6.35%
EPS Next 2Y6.7%
EPS Next 3Y7.33%
EPS Next 5Y5.7%
Revenue Next Year3.7%
Revenue Next 2Y3.73%
Revenue Next 3Y4.02%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 15.55, which indicates a correct valuation of NTRS.
NTRS's Price/Earnings is on the same level as the industry average.
NTRS is valuated rather cheaply when we compare the Price/Earnings ratio to 26.86, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 14.03, NTRS is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NTRS is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of NTRS to the average of the S&P500 Index (21.43), we can say NTRS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.55 | ||
| Fwd PE | 14.03 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NTRS is valued cheaper than 92.24% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NTRS indicates a somewhat cheap valuation: NTRS is cheaper than 78.02% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.21 | ||
| EV/EBITDA | 7.23 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NTRS does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.45
PEG (5Y)5.63
EPS Next 2Y6.7%
EPS Next 3Y7.33%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.70%, NTRS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 8.07, NTRS has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.43, NTRS has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
5.2 History
The dividend of NTRS has a limited annual growth rate of 3.64%.
NTRS has paid a dividend for at least 10 years, which is a reliable track record.
NTRS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.64%
Div Incr Years0
Div Non Decr Years25
5.3 Sustainability
NTRS pays out 29.63% of its income as dividend. This is a sustainable payout ratio.
The dividend of NTRS is growing, but earnings are growing more, so the dividend growth is sustainable.
DP29.63%
EPS Next 2Y6.7%
EPS Next 3Y7.33%
122.97
-0.83 (-0.67%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners87.18%
Inst Owner Change-0.63%
Ins Owners0.81%
Ins Owner Change11.86%
Market Cap23.92B
Analysts54.29
Price Target110 (-10.55%)
Short Float %3.38%
Short Ratio4.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
Yearly Dividend3.21
Dividend Growth(5Y)3.64%
DP29.63%
Div Incr Years0
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.21%
Min EPS beat(2)0.59%
Max EPS beat(2)9.83%
EPS beat(4)3
Avg EPS beat(4)3.2%
Min EPS beat(4)-8.4%
Max EPS beat(4)10.78%
EPS beat(8)5
Avg EPS beat(8)4.75%
EPS beat(12)5
Avg EPS beat(12)-2.91%
EPS beat(16)9
Avg EPS beat(16)-1.1%
Revenue beat(2)0
Avg Revenue beat(2)-1.52%
Min Revenue beat(2)-2.37%
Max Revenue beat(2)-0.68%
Revenue beat(4)0
Avg Revenue beat(4)-3.74%
Min Revenue beat(4)-11.65%
Max Revenue beat(4)-0.29%
Revenue beat(8)1
Avg Revenue beat(8)-3.18%
Revenue beat(12)4
Avg Revenue beat(12)-0.55%
Revenue beat(16)4
Avg Revenue beat(16)-0.87%
PT rev (1m)4.24%
PT rev (3m)-8.9%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)-2.83%
EPS NY rev (1m)1.37%
EPS NY rev (3m)-2.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.99%
Revenue NY rev (1m)0.15%
Revenue NY rev (3m)-1.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.55 | ||
| Fwd PE | 14.03 | ||
| P/S | 1.59 | ||
| P/FCF | 8.21 | ||
| P/OCF | 6.44 | ||
| P/B | 1.86 | ||
| P/tB | 2.44 | ||
| EV/EBITDA | 7.23 |
EPS(TTM)7.91
EY6.43%
EPS(NY)8.77
Fwd EY7.13%
FCF(TTM)14.99
FCFY12.19%
OCF(TTM)19.1
OCFY15.54%
SpS77.51
BVpS66.2
TBVpS50.39
PEG (NY)2.45
PEG (5Y)5.63
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.3% | ||
| ROE | 16.68% | ||
| ROCE | 12.32% | ||
| ROIC | 1.41% | ||
| ROICexc | 1.44% | ||
| ROICexgc | 1.56% | ||
| OM | 20.26% | ||
| PM (TTM) | 14.25% | ||
| GM | 56.93% | ||
| FCFM | 19.33% |
ROA(3y)0.93%
ROA(5y)0.86%
ROE(3y)11.89%
ROE(5y)11.57%
ROIC(3y)1.06%
ROIC(5y)0.96%
ROICexc(3y)1.09%
ROICexc(5y)0.98%
ROICexgc(3y)1.2%
ROICexgc(5y)1.07%
ROCE(3y)10.14%
ROCE(5y)9.75%
ROICexcg growth 3Y19.04%
ROICexcg growth 5Y4.26%
ROICexc growth 3Y17.62%
ROICexc growth 5Y3.85%
OM growth 3Y-16.14%
OM growth 5Y-8.62%
PM growth 3Y-17.54%
PM growth 5Y-9.62%
GM growth 3Y-18.4%
GM growth 5Y-9.82%
F-Score8
Asset Turnover0.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 11.43 | ||
| Debt/FCF | 50.48 | ||
| Debt/EBITDA | 38.81 | ||
| Cap/Depr | 108.68% | ||
| Cap/Sales | 5.31% | ||
| Interest Coverage | 0.42 | ||
| Cash Conversion | 98% | ||
| Profit Quality | 135.68% | ||
| Current Ratio | 0.03 | ||
| Quick Ratio | 0.03 | ||
| Altman-Z | -0.61 |
F-Score8
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)113.73%
Cap/Depr(5y)110.62%
Cap/Sales(3y)6.87%
Cap/Sales(5y)7.55%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)27.58%
EPS 3Y2.26%
EPS 5Y2.76%
EPS Q2Q%12.43%
EPS Next Y6.35%
EPS Next 2Y6.7%
EPS Next 3Y7.33%
EPS Next 5Y5.7%
Revenue 1Y (TTM)23.93%
Revenue growth 3Y33.14%
Revenue growth 5Y18.02%
Sales Q2Q%5.23%
Revenue Next Year3.7%
Revenue Next 2Y3.73%
Revenue Next 3Y4.02%
Revenue Next 5YN/A
EBIT growth 1Y111.39%
EBIT growth 3Y11.65%
EBIT growth 5Y7.85%
EBIT Next Year-15.33%
EBIT Next 3Y-3.84%
EBIT Next 5YN/A
FCF growth 1Y275.19%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y151.01%
OCF growth 3YN/A
OCF growth 5YN/A