NTRS  Northern Trust Corporation

Exchange

NASDAQ

Sector

Finance

Industry

Major Banks

Market Cap.

19934.36B

Vuru Grade

57.00/100

Current Price

$87.20
-0.14 (-0.16%)

Growth Price

$75.66
Overvalued by 13.23%

Stability Price

$197.86
Undervalued by 126.90%

Company Metrics

  • P/E 20.19
  • P/S 4003.04
  • P/B 2.25
  • EPS 4.32
  • Cash ROIC 0.45%
  • Cash Ratio -
  • Dividend 1.52 / 1.74 %
  • Avg. Vol. 1.31M
  • Shares 234.22M
  • Market Cap. 19934.36B

Company Description

Northern Trust Corporation, through its subsidiaries, provides investment management, asset and fund administration, banking solutions, and fiduciary services for corporations, institutions, and affluent individuals worldwide. It offers various deposit products, including demand and other noninterest bearing, savings, money market, savings certificates, and time deposit accounts. The company's loa... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

The Anthem Inc. (ANTM) Stake Boosted by the Northern Trust Corp
DailyQuint - Jan 5, 2017
Northern Trust Corp raised its position in shares of Anthem Inc. (NYSE:ANTM) by 0.2% during the third quarter, Holdings Channel reports.
The Ford Motor Co. (F) Shares Sold by the Northern Trust Corp
DailyQuint - Jan 5, 2017
Northern Trust Corp reduced its stake in Ford Motor Co. (NYSE:F) by 1.9% during the third quarter, according to its most recent Form 13F filing with the SEC.
Northern Trust Corporation (NTRS) Stake Reduced by Gamco Investors INC. ET AL
BNB Daily (blog) - Feb 18, 2017
Northern Trust Corporation logo Gamco Investors INC. ET AL cut its stake in Northern Trust Corporation (NASDAQ:NTRS) by 4.7% during the fourth quarter, Holdings Channel reports.
The Northern Trust Corporation (NTRS) Stake Maintained by Farr Miller ... - DailyQuint
Russell Investments Group Ltd. Takes Position in Northern Trust Corporation (NTRS) - The Cerbat Gem
Bp Plc Has $2672000 Position in Northern Trust Corporation (NTRS)
Sports Perspectives - Feb 6, 2017
Northern Trust Corporation logo Bp Plc maintained its stake in shares of Northern Trust Corporation (NASDAQ:NTRS) during the fourth quarter, according to its most recent disclosure with the SEC.
Large Buying Action and Inflow of Money Witnessed in Northern Trust Corporation - Highland Mirror
Northern Trust Corporation (NTRS) Stake Increased by ING Groep NV - The Cerbat Gem
Associated Banc Corp Cuts Position in Northern Trust Corporation (NTRS)
The Cerbat Gem - Feb 14, 2017
Northern Trust Corporation logo Associated Banc Corp cut its position in shares of Northern Trust Corporation (NASDAQ:NTRS) by 3.4% during the fourth quarter, according to its most recent 13F filing with the SEC.
Northern Trust Survey: Majority of Fund Managers See Upcoming Regulatory ... - Yahoo Finance
Northern Trust Appointed by Alpine Global Master Fund
Yahoo Finance - Feb 13, 2017
Alpine Global Master Fund, a long/short market-neutral hedge fund, has appointed Northern Trust (NTRS) to provide hedge fund administration services and middle office outsourcing.
Northern Trust Corporation (NTRS) Position Lowered by Raymond James Financial ... - The Cerbat Gem
Insider Trading at Northern Trust Corporation? - Sports Perspectives
John Rogers Comments on Northern Trust Corp
GuruFocus.com - Jan 20, 2017
In addition, wealth management firm Northern Trust Corp. (NASDAQ:NTRS) surged +31.58% on broad news that boosted many financial companies.
Jeffrey D. Cohodes Sells 15000 Shares of Northern Trust Corp. (NTRS) Stock - Sports Perspectives
Stock Returns: Northern Trust Corporation (NASDAQ:NTRS) is Beating Invesco Ltd ... - CML News
Donaldson Capital Management LLC Cuts Stake in Northern Trust Corporation (NTRS)
The Cerbat Gem - Feb 9, 2017
Northern Trust Corporation logo Donaldson Capital Management LLC lowered its position in Northern Trust Corporation (NASDAQ:NTRS) by 15.8% during the third quarter, according to its most recent 13F filing with the SEC.
Marble Harbor Investment Counsel Boosts Position by $9428158 in Northern Trust ... - Highland Mirror
Busey Trust CO Has $1179000 Position in Northern Trust Corporation (NTRS)
Sports Perspectives - Jan 30, 2017
Northern Trust Corporation logo Busey Trust CO maintained its stake in shares of Northern Trust Corporation (NASDAQ:NTRS) during the fourth quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC).
Northern Trust Corporation - Receive News & Ratings Daily - BBNS
Dividend Growth of Northern Trust Corporation(NTRS)
Highland Mirror - Feb 17, 2017
Northern Trust Corporation(NTRS) is having a Dividend Yield of 1.71% with the Annual cash Dividend per share of $1.48. The last quarter cash dividend per share pay out was $0.38.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for NTRS to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate NTRS's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$87.20 Current Price

$75.66 Growth Price (DCF)

Overvalued by 13.23%


Growth Rate Assumed by Market: 6.61%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$197.86 Stability Price (EPV)

Undervalued by 126.90%


Discount Rate: 15.0%

$70.94 Book Price

Overvalued by 18.65%


Poor Cash Return on Invested Capital over the past 5 years

NTRS has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

NTRS has only created $0.45 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20112012201320142015
Free Cash Flow 1.25B 277.60M - -535.40M 1.40B
divided by
Invested Capital 100.22B 97.46B 102.66B 109.95B 116.75B
Cash ROIC 1.25% 0.28% - -0.49% 1.20%

Poor Return on Equity over the past 5 years

NTRS has shown an inability to deliver strong results for shareholders. This could be due to poor management, NTRS operating in a highly competitive industry, or having a weak business in general.

NTRS has only generated $9.73 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20112012201320142015
Net Income 603.60M 687.30M 727.50M 811.80M 973.80M
divided by
Stockholders' Equity 7.12B 7.53B 7.10B 8.45B 8.71B
Return on Equity 8.48% 9.13% 10.24% 9.61% 11.19%

Good Business Performance over the past 10 years

It's likely NTRS has been unable to maintain profitability in tough economic times, making it a somewhat cyclical business. The other possibility is NTRS has expended significant capital on items such as property, plant and equipment in specific years. Look for correlations.

NTRS has created positive free cash flow for 7 or 8 of the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow 388.50M 880.70M 855.30M 882.10M 699.70M 1.25B 277.60M - -535.40M 1.40B

Weak Balance Sheet

NTRS's financial position is not ideal. The key is to check whether NTRS is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Cash - - - - - - - - - -
Current Assets - - - - - - - - - -
Total Assets 60.71B 67.61B 82.05B 82.14B 83.84B 100.22B 97.46B 102.66B 109.95B 116.75B
Current Liabilities - - - - - - - - - -
Total Liabilities 56.77B 63.10B 75.66B 75.83B 77.01B 93.11B 89.94B 95.56B 101.50B 108.04B
Stockholder' Equity 3.94B 4.51B 6.39B 6.31B 6.83B 7.12B 7.53B 7.10B 8.45B 8.71B
Current Ratio - - - - - - - - - -
TL-to-TA 0.94 0.93 0.92 0.92 0.92 0.93 0.92 0.93 0.92 0.93

Low or No Reinvestment of Profits over the past 10 years

NTRS has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to NTRS operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings 4.13B 4.56B 5.09B 5.58B 5.97B 6.30B 6.70B - 7.63B 8.24B
Retained Earnings Growth - 10.29% 11.74% 9.52% 7.10% 5.53% 6.35% -100.00% - 8.10%

Potential Competitive Advantage over the past 10 years

NTRS potentially has a competitive advantage. This could be strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at its future prospects to determine sustainability and whether the economic moat will strengthen.

$19.43 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income 665.40M 726.90M 794.80M 864.20M 669.50M 603.60M 687.30M 727.50M 811.80M 973.80M
divided by
Revenue 3.00B 3.51B 4.28B 3.79B 3.65B 3.77B 3.90B 3.92B 4.33B 4.70B
Net Profit Margin 22.21% 20.72% 18.58% 22.82% 18.35% 16.01% 17.64% 18.55% 18.74% 20.71%

Weak Pricing Power over the past 10 years

NTRS is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that NTRS has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $- of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit - - - - - - - - - -
divided by
Revenue 3.00B 3.51B 4.28B 3.79B 3.65B 3.77B 3.90B 3.92B 4.33B 4.70B
Gross Margin - - - - - - - - - -

Medium Capital Intensity over the past 10 years

NTRS has used a reasonable amount of their financial resources to invest in facilities and equipment required to produce its goods and services. This isn't perfect, but it shouldn't be an area of concern unless this number is strongly trending upwards.

31.72% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure - - - 132.60M 90.50M - 239.20M - 409.50M 433.50M
divided by
Net Income 665.40M 726.90M 794.80M 864.20M 669.50M 603.60M 687.30M 727.50M 811.80M 973.80M
Capital Expenditure Ratio - - - 15.34% 13.52% - 34.80% - 50.44% 44.52%

Inconsistent Dividend History over the past 10 years

NTRS has started distributing dividends in the past couple years or has recently suspended their dividend distribution. The reliability of future distributions is unclear.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid 200.50M 219.50M 247.70M 306.90M 273.20M 273.70M 354.30M - 302.90M 348.40M
divided by
Shares Outstanding 221.78M 224.32M 225.38M 236.42M 242.50M 241.81M 240.88M - 235.83M 234.22M
Dividend Paid Per Share 0.90 0.98 1.10 1.30 1.13 1.13 1.47 - 1.28 1.49
Price at Year End 54.77 70.34 46.93 50.12 54.06 39.66 49.95 61.72 68.07 72.83
Dividend Yield 1.65% 1.39% 2.34% 2.59% 2.08% 2.85% 2.94% - 1.89% 2.04%

History of Stock Buybacks over the past 10 years

NTRS has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 221.78M 224.32M 225.38M 236.42M 242.50M 241.81M 240.88M - 235.83M 234.22M
Stock Bought Back - -1.13% -0.47% -4.67% -2.51% 0.29% 0.39% - -100.00% 0.69%
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