NORTHERN TRUST CORP (NTRS) Stock Fundamental Analysis
NASDAQ:NTRS - Nasdaq - US6658591044 - Common Stock - Currency: USD
Taking everything into account, NTRS scores 4 out of 10 in our fundamental rating. NTRS was compared to 233 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 correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year NTRS was profitable.
In the past year NTRS had a positive cash flow from operations.
Each year in the past 5 years NTRS has been profitable.
Of the past 5 years NTRS 4 years had a positive operating cash flow.
1.2 Ratios
NTRS has a worse Return On Assets (1.30%) than 60.68% of its industry peers.
The Return On Equity of NTRS (16.68%) is better than 81.20% of its industry peers.
Looking at the Return On Invested Capital, with a value of 1.41%, NTRS is doing worse than 68.80% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NTRS is significantly below the industry average of 7.84%.
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
Looking at the Profit Margin, with a value of 14.25%, NTRS is in line with its industry, outperforming 52.14% of the companies in the same industry.
In the last couple of years the Profit Margin of NTRS has declined.
Looking at the Operating Margin, with a value of 20.26%, NTRS is in line with its industry, outperforming 41.88% of the companies in the same industry.
NTRS's Operating Margin has declined in the last couple of years.
The Gross Margin of NTRS (56.93%) is better than 65.81% of its industry peers.
In the last couple of years the Gross Margin of NTRS has declined.
| 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
Compared to 1 year ago, NTRS has less shares outstanding
Compared to 5 years ago, NTRS has less shares outstanding
The debt/assets ratio for NTRS is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of -0.60, we must say that NTRS is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of -0.60, NTRS is not doing good in the industry: 83.33% of the companies in the same industry are doing better.
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.
With a Debt to FCF ratio value of 50.48, NTRS perfoms like the industry average, outperforming 42.73% of the companies in the same industry.
A Debt/Equity ratio of 11.43 is on the high side and indicates that NTRS has dependencies on debt financing.
NTRS's Debt to Equity ratio of 11.43 is on the low side compared to the rest of the industry. NTRS is outperformed by 91.03% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 11.43 | ||
| Debt/FCF | 50.48 | ||
| Altman-Z | -0.6 |
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 has a Current ratio of 0.03. This is amonst the worse of the industry: NTRS underperforms 95.30% of its industry peers.
NTRS has a Quick Ratio of 0.03. This is a bad value and indicates that NTRS is not financially healthy enough and could expect problems in meeting its short term obligations.
NTRS has a Quick ratio of 0.03. This is amonst the worse of the industry: NTRS underperforms 95.30% 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.
Looking at the last year, NTRS shows a very strong growth in Revenue. The Revenue has grown by 23.93%.
The Revenue has been growing by 18.02% on average over the past years. This is quite good.
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 4.21% on average over the next years.
EPS Next Y7.39%
EPS Next 2Y7.16%
EPS Next 3Y7.29%
EPS Next 5Y5.7%
Revenue Next Year4.11%
Revenue Next 2Y3.99%
Revenue Next 3Y4.21%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 15.92, the valuation of NTRS can be described as correct.
NTRS's Price/Earnings ratio is in line with the industry average.
NTRS is valuated rather cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 14.24 indicates a correct valuation of NTRS.
NTRS's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of NTRS to the average of the S&P500 Index (21.76), we can say NTRS is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.92 | ||
| Fwd PE | 14.24 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NTRS is valued cheaply inside the industry as 92.73% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, NTRS is valued a bit cheaper than the industry average as 78.63% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.4 | ||
| EV/EBITDA | 7.34 |
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)2.15
PEG (5Y)5.77
EPS Next 2Y7.16%
EPS Next 3Y7.29%
5. Dividend
5.1 Amount
NTRS has a Yearly Dividend Yield of 2.37%. Purely for dividend investing, there may be better candidates out there.
NTRS's Dividend Yield is comparable with the industry average which is at 8.12.
Compared to an average S&P500 Dividend Yield of 2.35, NTRS has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
5.2 History
The dividend of NTRS has a limited annual growth rate of 3.64%.
NTRS has been paying a dividend for at least 10 years, so it has 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.
NTRS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP29.63%
EPS Next 2Y7.16%
EPS Next 3Y7.29%
125.91
-0.71 (-0.56%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners87.18%
Inst Owner Change-0.02%
Ins Owners0.81%
Ins Owner Change11.84%
Market Cap24.49B
Analysts54.29
Price Target110 (-12.64%)
Short Float %3.42%
Short Ratio3.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
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)3.09%
PT rev (3m)-7.46%
EPS NQ rev (1m)1.07%
EPS NQ rev (3m)-0.22%
EPS NY rev (1m)2.36%
EPS NY rev (3m)-1.77%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.5%
Revenue NY rev (1m)0.59%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.92 | ||
| Fwd PE | 14.24 | ||
| P/S | 1.62 | ||
| P/FCF | 8.4 | ||
| P/OCF | 6.59 | ||
| P/B | 1.9 | ||
| P/tB | 2.5 | ||
| EV/EBITDA | 7.34 |
EPS(TTM)7.91
EY6.28%
EPS(NY)8.84
Fwd EY7.02%
FCF(TTM)14.99
FCFY11.9%
OCF(TTM)19.1
OCFY15.17%
SpS77.51
BVpS66.2
TBVpS50.39
PEG (NY)2.15
PEG (5Y)5.77
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 | -0.6 |
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 Y7.39%
EPS Next 2Y7.16%
EPS Next 3Y7.29%
EPS Next 5Y5.7%
Revenue 1Y (TTM)23.93%
Revenue growth 3Y33.14%
Revenue growth 5Y18.02%
Sales Q2Q%5.23%
Revenue Next Year4.11%
Revenue Next 2Y3.99%
Revenue Next 3Y4.21%
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