Fact based stock research
Northern Trust (NasdaqGS:NTRS)

US6658591044

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Northern Trust stock research in summary

northerntrust.com

ANALYSIS: With an Obermatt Combined Rank of 22 (worse than 78% compared with investment alternatives), Northern Trust (Asset Management & Custody, USA) shares have lower financial characteristics compared with similar stocks. Shares of Northern Trust are low in value (priced high) with a consolidated Value Rank of 40 (worse than 60% of alternatives), show below-average growth (Growth Rank of 40), and are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 22, is a sell recommendation based on Northern Trust's financial characteristics. As the company Northern Trust's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 40), low growth (Obermatt Growth Rank of 40), and risky financing practices (Obermatt Safety Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	40
Growth Rank	40
Safety Rank	43
Combined Rank	22

Country	USA
Industry	Asset Management & Custody
Index	Diversity USA, NASDAQ, S&P 500
Size class	X-Large

23-Jan-2025. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Northern Trust

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	5	35	28	40
GROWTH
GROWTH	12	43	53	40
SAFETY
SAFETY	55	25	51	43
SENTIMENT
SENTIMENT	n/a	35	14	^new
360° VIEW
360° VIEW	n/a	15	18	^new

Most recent update of the stock research: 23-Jan-2025. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Northern Trust is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	5	35	28	40
GROWTH
GROWTH	12	43	53	40
SAFETY
SAFETY	55	25	51	43
COMBINED
COMBINED	12	9	40	22

Last update of combined financial performance: 23-Jan-2025. Stock analysis on combined financial performance: The higher the rank of Northern Trust the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 40 (worse than 60% compared with alternatives), Northern Trust shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Northern Trust. Price-to-Sales (P/S) is 73, which means that the stock price compared with what market professionals expect for future sales is lower than for 73% of comparable companies, indicating a good value concerning Northern Trust's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 55, which means that dividends are expected to be higher than for 55% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 83% of alternatives (only 17% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 75% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 40, is a hold recommendation based on Northern Trust's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	18	53	63	73
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	7	23	17	25
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	8	13	17	17
DIVIDEND YIELD
DIVIDEND YIELD	38	63	63	55
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	5	35	28	40

Last update of Value Rank: 23-Jan-2025. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Northern Trust; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 40 (better than 40% compared with alternatives), Northern Trust shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Northern Trust. Profit Growth has a rank of 96, which means that currently professionals expect the company to grow its profits more than 96% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 74 (above 74% of alternative investments). But Sales Growth has a below the median rank of 25, which means that, currently, professionals expect the company to grow less than 75% of its competitors, and Capital Growth also has a lower rank of 18. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 40, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Northern Trust. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	10	73	52	25
PROFIT GROWTH
PROFIT GROWTH	62	45	50	96
CAPITAL GROWTH
CAPITAL GROWTH	n/a	29	54	18
STOCK RETURNS
STOCK RETURNS	64	59	47	74
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	12	43	53	40

Last update of Growth Rank: 23-Jan-2025. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Northern Trust.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company Northern Trust has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Northern Trust is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Northern Trust. Refinancing is at 68, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 68% of its competitors. Liquidity is also good at 61, meaning the company generates more profit to service its debt than 61% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 1, which means the company has an above-average debt-to-equity ratio. It has more debt than 99% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 43 (worse than 57% compared with alternatives), Northern Trust has a financing structure that is riskier than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Northern Trust could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Northern Trust and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	52	4	1	1
REFINANCING
REFINANCING	34	39	63	68
LIQUIDITY
LIQUIDITY	36	67	74	61
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	55	25	51	43

Last update of Safety Rank: 23-Jan-2025. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Northern Trust and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	36	9	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	87	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	43	42	^new
MARKET PULSE
MARKET PULSE	n/a	6	41	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	35	14	^new

Last update of Sentiment Rank: 23-Jan-2025. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Northern Trust.
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