BNY’s Strong Potential for Outperformance: Buy Rating Backed by Asset-Light Model, Strategic Flexibility, and Effective Management

In a report released yesterday, Ebrahim Poonawala from Bank of America Securities reiterated a Buy rating on BNY, with a price target of $106.00.

Ebrahim Poonawala has given his Buy rating due to a combination of factors that highlight BNY’s strong potential for stock outperformance. The company’s asset-light model, where fees constitute approximately 75% of revenues, supports robust capital returns through buybacks and dividends, equating to nearly 100% of earnings per share. This model also provides strategic flexibility for mergers and acquisitions. Moreover, BNY’s shares are attractively valued at 11.7 times the projected 2026 price-to-earnings ratio, which is favorable compared to the expected 15% average annual EPS growth from fiscal years 2025 to 2027 and relative to other asset-light peers trading at higher multiples.
Additionally, Poonawala expresses confidence in BNY’s management team, led by CEO Robin Vince, which has demonstrated effective execution of strategic plans, resulting in superior shareholder returns. Since Vince took over as CEO, BNY’s stock has significantly outperformed the S&P and the financial sector. The company’s strong fundamental performance, including exceeding net revenue expectations and leading in digital innovation, further supports the Buy rating. Poonawala expects the market to align more closely with his above-consensus earnings forecasts for the latter half of 2025 and fiscal year 2026, reinforcing his positive outlook on the stock.

According to TipRanks, Poonawala is a 5-star analyst with an average return of 13.4% and a 70.65% success rate. Poonawala covers the Financial sector, focusing on stocks such as JPMorgan Chase, Goldman Sachs Group, and BNY.

In another report released today, Barclays also maintained a Buy rating on the stock with a $104.00 price target.