Financial Comparison: Northern Trust (NTRS) vs. Its Competitors

Northern Trust (NASDAQ:NTRS) is one of 1,743 publicly-traded companies in the “Capital Markets” industry, but how does it compare to its peers? We will compare Northern Trust to related companies based on the strength of its institutional ownership, valuation, analyst recommendations, earnings, profitability, dividends and risk.

Risk & Volatility

Northern Trust has a beta of 1.21, suggesting that its share price is 21% more volatile than the S&P 500. Comparatively, Northern Trust’s peers have a beta of 0.79, suggesting that their average share price is 21% less volatile than the S&P 500.

Profitability

This table compares Northern Trust and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northern Trust	15.86%	17.97%	1.27%
Northern Trust Competitors	318.28%	11.55%	3.69%

Analyst Recommendations

This is a summary of recent recommendations and price targets for Northern Trust and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northern Trust	2	11	2	0	2.00
Northern Trust Competitors	5561	20139	22479	642	2.37

Northern Trust presently has a consensus price target of $181.03, indicating a potential upside of 4.79%. As a group, “Capital Markets” companies have a potential upside of 26.56%. Given Northern Trust’s peers stronger consensus rating and higher probable upside, analysts plainly believe Northern Trust has less favorable growth aspects than its peers.

Dividends

Northern Trust pays an annual dividend of $3.52 per share and has a dividend yield of 2.0%. Northern Trust pays out 27.6% of its earnings in the form of a dividend. As a group, “Capital Markets” companies pay a dividend yield of 3.2% and pay out 29.2% of their earnings in the form of a dividend.

Valuation and Earnings

This table compares Northern Trust and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Northern Trust	$8.75 billion	$1.74 billion	13.54
Northern Trust Competitors	$2.23 billion	$398.65 million	16.70

Northern Trust has higher revenue and earnings than its peers. Northern Trust is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Insider & Institutional Ownership

83.2% of Northern Trust shares are owned by institutional investors. Comparatively, 30.5% of shares of all “Capital Markets” companies are owned by institutional investors. 0.7% of Northern Trust shares are owned by insiders. Comparatively, 12.9% of shares of all “Capital Markets” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Northern Trust peers beat Northern Trust on 9 of the 15 factors compared.

Northern Trust Company Profile

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; muti-asset and 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.