Northern (NTRS) AI Stock Analysis

• Market Cap: $24.77B
• Dividend Yield: 2.32%
• Average Volume (3M): 1.03M
• Price to Earnings (P/E): 15.2
• Beta (1Y): 1.18
• Revenue Growth: 3.44%
• EPS Growth: 16.76%
• Country: US
• Employees: 23,400
• Sector: Financial
• Sector Strength: 70
• Industry: Asset Management
• EPS (TTM): 2.13
• Shares Outstanding: 191,233,300
• 10 Day Avg. Volume: 1,285,473
• 30 Day Avg. Volume: 1,030,658
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: -0.67
• Enterprise Value/Revenue: -1.13
• Enterprise Value/Gross Profit: -2.11
• Enterprise Value/Ebitda: -5.47
• 1Y Price Target: $127.77
• Price Target Upside: -2.75% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 14

• Rating: 71 Outperform
• Price Target: $143.00 ▲(8.84% Upside)

Northern Trust's overall score is driven by strong earnings performance and positive technical indicators. While financial performance shows profitability, challenges in revenue growth and cash flow are notable. The company's strategic initiatives and corporate actions, such as stock buybacks and leadership changes, further support its potential for future growth.

Positive Factors

Revenue and EPS Growth

The company's strong revenue and EPS growth indicate effective business strategies and operational efficiency, enhancing its competitive position.

Leadership Enhancement

The appointment of a seasoned leader is expected to strengthen asset management capabilities, driving long-term growth and client value.

Capital Return to Shareholders

Returning capital to shareholders demonstrates strong cash generation and commitment to shareholder value, supporting investor confidence.

Negative Factors

Revenue Growth Challenges

Declining revenue growth poses a risk to long-term financial stability, potentially impacting future profitability and market position.

Cash Flow Concerns

Reduced cash flow growth limits financial flexibility, potentially affecting the company's ability to invest in growth opportunities.

High Leverage

High leverage can increase financial risk, impacting the company's ability to withstand economic downturns and invest in strategic initiatives.

Northern Business Overview & Revenue Model

Company Description

Northern Trust Corporation, a financial holding company, provides wealth management, asset servicing, asset management, and banking solutions for corporations, institutions, families, and individuals worldwide. It operates in two segments, Asset Servicing and Wealth Management. The Asset Servicing segment offers asset servicing and related services, including custody, fund administration, investment operations outsourcing, investment management, investment risk and analytical services, employee benefit services, securities lending, foreign exchange, treasury management, brokerage services, transition management services, banking, and cash management services. This segment serves corporate and public retirement funds, foundations, endowments, fund managers, insurance companies, sovereign wealth funds, and other institutional investors. The Wealth Management segment offers trust, investment management, custody, and philanthropic; financial consulting; guardianship and estate administration; family business consulting; family financial education; brokerage services; and private and business banking services. This segment serves high-net-worth individuals and families, business owners, executives, professionals, retirees, and established privately held businesses. The company also provides asset management services, such as active and passive equity; active and passive fixed income; cash management; alternative asset classes comprising private equity and hedge funds of funds; and multi-manager advisory services and products through separately managed accounts, bank common and collective funds, registered investment companies, exchange traded funds, non-U.S. collective investment funds, and unregistered private investment funds. In addition, it offers overlay and other risk management services. Northern Trust Corporation was founded in 1889 and is headquartered in Chicago, Illinois.

How the Company Makes Money

Northern Trust generates revenue through several key streams, primarily encompassing asset servicing fees, investment management fees, and banking services. Asset servicing involves providing custodian services, fund administration, and related support to institutional clients, which forms a significant portion of their income. Investment management fees arise from managing assets for clients in various investment vehicles, including mutual funds and separate accounts. Additionally, the company offers private banking services, generating revenue through interest on loans and fees for banking services. Strategic partnerships with financial institutions and investment firms enhance their service offerings and broaden their client base, contributing positively to their overall earnings.

Northern Financial Statement Overview

Summary

Northern Trust demonstrates strong profitability margins and return on equity, but faces challenges in revenue growth and cash flow generation. The high leverage ratio indicates potential risk, yet the company maintains a stable balance sheet.

Income Statement

The income statement shows a mixed performance. The TTM revenue has declined by 6.95%, indicating a contraction in sales. However, the company maintains a healthy gross profit margin of 53.32% and a net profit margin of 11.77%, reflecting good cost management. The EBIT and EBITDA margins are also solid at 15.49% and 20.60%, respectively, though they have decreased compared to previous periods. Overall, the company demonstrates profitability but faces challenges in revenue growth.

Balance Sheet

The balance sheet reveals a stable financial position with a debt-to-equity ratio of 1.30, which is relatively high but manageable. The return on equity (ROE) is strong at 13.52%, indicating efficient use of equity to generate profits. The equity ratio stands at 7.49%, suggesting a moderate level of equity financing. While the company is leveraged, it maintains a solid return on equity, balancing risk and profitability.

Cash Flow

Cash flow analysis indicates some concerns. The free cash flow has declined by 39.65% in the TTM, and the operating cash flow to net income ratio is low at 1.85%. The free cash flow to net income ratio is 67.78%, showing that a significant portion of net income is converted into free cash flow. Despite these challenges, the company generates positive free cash flow, albeit at a reduced growth rate.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.73B	15.88B	12.12B	7.75B	6.49B	6.30B
Gross Profit	7.85B	8.29B	6.75B	6.75B	6.55B	5.98B
EBITDA	3.03B	3.38B	2.10B	2.32B	2.53B	2.13B
Net Income	1.73B	2.03B	1.11B	1.34B	1.55B	1.21B
Balance Sheet
Total Assets	171.88B	155.51B	150.78B	155.04B	183.89B	170.00B
Cash, Cash Equivalents and Short-Term Investments	72.47B	56.54B	64.93B	74.52B	108.29B	107.88B
Total Debt	16.69B	15.99B	17.24B	14.85B	8.43B	9.60B
Total Liabilities	159.02B	142.72B	138.89B	143.78B	171.87B	158.32B
Stockholders Equity	12.87B	12.79B	11.90B	11.26B	12.02B	11.69B
Cash Flow
Free Cash Flow	1.76B	-1.23B	1.95B	1.67B	840.90M	1.34B
Operating Cash Flow	2.60B	-486.00M	2.63B	2.39B	1.36B	1.90B
Investing Cash Flow	-12.63B	-2.56B	4.78B	25.93B	-18.60B	-29.92B
Financing Cash Flow	9.48B	3.44B	-7.18B	-26.44B	16.07B	27.87B

Northern Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 131.38
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTRS, the sentiment is Positive. The current price of 131.38 is above the 20-day moving average (MA) of 129.63, above the 50-day MA of 128.11, and above the 200-day MA of 110.24, indicating a bullish trend. The MACD of 0.97 indicates Negative momentum. The RSI at 57.37 is Neutral, neither overbought nor oversold. The STOCH value of 47.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NTRS.

Northern Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BK	79 Outperform	76.24B	16.51	10.96%	1.78%	7.41%	51.70%
SEIC	76 Outperform	10.63B	16.14	29.48%	1.15%	10.55%	40.74%
STT	73 Outperform	32.05B	12.66	10.44%	2.66%	11.66%	67.88%
TROW	72 Outperform	22.73B	11.57	19.30%	4.89%	4.43%	5.55%
NTRS	71 Outperform	$24.77B	15.22	13.47%	2.32%	3.44%	16.76%
BEN	67 Neutral	12.24B	45.22	2.53%	5.43%	4.72%	-67.85%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Northern Corporate Events

Northern Trust Appoints Michael Hunstad as President

On September 3, 2025, Northern Trust Corporation announced the appointment of Michael Hunstad as the new President of Northern Trust Asset Management, succeeding Daniel E. Gamba. Hunstad, who has been with the company since 2012, previously served as Global Co-Chief Investment Officer and has been instrumental in shaping the firm’s investment strategies. His extensive experience and leadership are expected to enhance Northern Trust’s asset management capabilities and deliver exceptional value to clients and stakeholders.

Northern Trust Approves $2.5 Billion Stock Buyback

On July 22, 2025, Northern Trust Corporation’s Board of Directors approved a new stock repurchase authorization allowing the repurchase of up to $2.5 billion of its common stock, replacing the previous authorization from October 2021. This new authorization, which has no expiration date, provides the company with flexibility to repurchase shares based on market conditions and regulatory requirements, potentially impacting its stock value and shareholder returns.

Northern Trust Reports Strong Q2 Earnings and Dividend Increase

On July 23, 2025, Northern Trust Corporation reported a second-quarter net income of $421.3 million, with earnings per diluted common share of $2.13, reflecting an increase from the first quarter of 2025 but a decrease compared to the same period in 2024. The corporation experienced growth in trust fees, record net interest income, and an improved pretax margin, contributing to a 20% rise in earnings per share, excluding notable items from the previous period. The company also announced a 7% increase in its quarterly dividend, indicating strong financial momentum and a commitment to delivering value to clients and shareholders.