Northern Trust (NASDAQ:NTRS) Posts Earnings Results, Beats Estimates By $0.53 EPS

Northern Trust (NASDAQ:NTRS) posted its earnings results on Wednesday. The asset manager reported $3.40 earnings per share for the quarter, beating the consensus estimate of $2.87 by $0.53, Briefing.com reports. Northern Trust had a net margin of 14.76% and a return on equity of 16.91%. The business had revenue of $2.29 billion for the quarter, compared to analyst estimates of $2.26 billion. During the same quarter in the previous year, the business posted $2.29 EPS. The business’s quarterly revenue was up 13.4% on a year-over-year basis.

Here are the key takeaways from Northern Trust’s conference call:

• Strong third-quarter performance: Excluding notable items, revenue rose 11% year over year, supported by 8% trust-fee growth, 14% net interest income growth and 38% capital-markets growth. Pre-tax income increased 21% and EPS rose 40%, with more than 600 basis points of positive operating leverage.
• Management raised its near-term outlook, expecting fourth-quarter net interest income to grow 8%–9% year over year and total revenue to grow 6%–7%, assuming stable markets and interest rates. The company expects at least 500 basis points of operating leverage for full-year 2026.
• Wealth management and asset servicing continued to show momentum, including 16% Global Family Office fee growth, strong wealth-management flows and a UBS fund-administration expansion that could increase serviced UBS assets by more than 50%. Asset servicing delivered a 30% pre-tax margin, while asset management recorded its sixth consecutive quarter of positive ETF flows.
• Northern Trust returned $514 million to shareholders in the quarter and authorized an additional $3.5 billion for repurchases, while maintaining a 12.4% CET1 ratio. However, management cautioned that FX revenue remains above normalized levels, deposits declined seasonally in the third quarter, and the effective tax rate is expected to rise to about 25% from 19.3%.

Northern Trust Trading Up 0.9%

NASDAQ:NTRS opened at $166.91 on Thursday. The company has a debt-to-equity ratio of 0.43, a quick ratio of 0.65 and a current ratio of 0.65. Northern Trust has a one year low of $121.53 and a one year high of $195.78. The business’s 50-day simple moving average is $178.14 and its 200 day simple moving average is $173.67. The stock has a market cap of $30.54 billion, a price-to-earnings ratio of 15.52, a price-to-earnings-growth ratio of 0.94 and a beta of 1.24.

Northern Trust Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Friday, January 1st. Stockholders of record on Friday, December 4th will be given a dividend of $0.88 per share. This represents a $3.52 dividend on an annualized basis and a dividend yield of 2.1%. The ex-dividend date of this dividend is Friday, December 4th. Northern Trust’s payout ratio is presently 30.21%.

Insider Transactions at Northern Trust

In other Northern Trust news, Director Robert Moritz, Jr. bought 255 shares of the business’s stock in a transaction on Wednesday, July 29th. The shares were bought at an average cost of $179.57 per share, with a total value of $45,790.35. Following the transaction, the director directly owned 8,400 shares in the company, valued at approximately $1,508,388. This trade represents a 3.13% increase in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through this link. Also, EVP Thomas South sold 1,800 shares of the stock in a transaction that occurred on Monday, August 24th. The shares were sold at an average price of $184.90, for a total value of $332,820.00. Following the transaction, the executive vice president owned 92,917 shares of the company’s stock, valued at approximately $17,180,353.30. This trade represents a 1.90% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Corporate insiders own 0.66% of the company’s stock.

Analyst Ratings Changes

Several research analysts have commented on NTRS shares. JPMorgan Chase & Co. cut their price objective on Northern Trust from $185.50 to $185.00 and set a “neutral” rating on the stock in a research report on Friday, October 2nd. Bank of America increased their target price on Northern Trust from $190.00 to $200.00 and gave the company a “buy” rating in a research note on Tuesday, July 7th. Zacks Research downgraded Northern Trust from a “strong-buy” rating to a “hold” rating in a report on Tuesday, August 25th. Weiss Ratings raised Northern Trust from a “buy (b)” rating to a “buy (b+)” rating in a research report on Thursday, October 8th. Finally, TD Cowen initiated coverage on Northern Trust in a report on Thursday, October 8th. They issued a “hold” rating and a $175.00 price target for the company. Three research analysts have rated the stock with a Buy rating, ten have issued a Hold rating and two have assigned a Sell rating to the company’s stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Hold” and an average price target of $184.27.

Northern Trust News Summary

Here are the key news stories impacting Northern Trust this week:

• Positive Sentiment: Northern Trust reported third-quarter adjusted earnings of approximately $3.40 per share, well above the consensus estimate near $2.87, while revenue of $2.29 billion also exceeded expectations. Earnings increased sharply from $2.29 per share a year earlier. Northern Trust Corporation Q3 Earnings and Revenues Surpass Estimates
• Positive Sentiment: Results benefited from a 14% year-over-year increase in net interest income, higher trust and servicing fees, and 11% growth in assets under management. Assets under custody or administration reached $19.9 trillion, supporting the company’s fee-based business. Northern Trust Delivers Q3 Earnings Beat as AUM Grows
• Positive Sentiment: The company returned $514.2 million to shareholders through dividends and repurchases and raised its quarterly dividend to $0.88 per share from $0.80, providing an annualized payout of $3.52. Northern Trust Reports Third-Quarter Results
• Neutral Sentiment: Standard Chartered agreed to acquire full control of Zodia Custody, a digital-asset custody venture founded with Northern Trust. The deal may validate the business’s institutional opportunity, although Northern Trust’s direct future economic involvement was not detailed. Standard Chartered Takes Full Control of Zodia Crypto Custody Arm
• Negative Sentiment: Quarter-over-quarter momentum weakened: revenue fell 15% and net income declined to $642.9 million from $792.2 million. Elevated operating expenses and credit costs remain concerns, even though expenses decreased sequentially. Northern Trust Reports Third-Quarter and Nine-Month Results

About Northern Trust

Northern Trust Corporation (NASDAQ:NTRS) is a financial services company that provides wealth management, asset servicing, asset management and banking services. The company serves institutional investors, corporations, financial institutions, high-net-worth individuals and families.

Its offerings include custody and administration of investment assets, fund accounting, securities lending, foreign exchange, treasury services, investment management, trust and estate services, private banking and wealth planning.