Northern Trust Corporation Fundamental Analysis (NASDAQ: NTRS)
Northern Trust Corporation Fundamental Analysis (NASDAQ: NTRS)
Northern Trust Corporation (NASDAQ: NTRS) shows moderate financial fundamentals with a PE ratio of 15.75, profit margin of 14.76%, and ROE of 17.14%. The company generates $15.1B in annual revenue with weak year-over-year growth of -9.93%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 37.6/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze NTRS's fundamental strength across five key dimensions:
Efficiency Score
WeakNTRS struggles to generate sufficient returns from assets.
Valuation Score
ExcellentNTRS trades at attractive valuation levels.
Growth Score
WeakNTRS faces weak or negative growth trends.
Financial Health Score
ModerateNTRS shows balanced financial health with some risks.
Profitability Score
ModerateNTRS maintains healthy but balanced margins.
Key Financial Metrics
Is NTRS Expensive or Cheap?
P/E Ratio
NTRS trades at 15.75 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, NTRS's PEG of 0.43 indicates potential undervaluation.
Price to Book
The market values Northern Trust Corporation at 2.53 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 18.83 times EBITDA. This signals the market has high growth expectations.
How Well Does NTRS Make Money?
Net Profit Margin
For every $100 in sales, Northern Trust Corporation keeps $14.76 as profit after all expenses.
Operating Margin
Core operations generate 19.83 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $17.14 in profit for every $100 of shareholder equity.
ROA
Northern Trust Corporation generates $1.25 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Northern Trust Corporation generates limited operating cash flow of $526.31M, signaling weaker underlying cash strength.
Free Cash Flow
Northern Trust Corporation generates weak or negative free cash flow of $130.36M, restricting financial flexibility.
FCF Per Share
Each share generates $0.71 in free cash annually.
FCF Yield
NTRS converts 0.39% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
15.75
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.43
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.53
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.22
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.18
vs 25 benchmark
Current Ratio
Current assets to current liabilities
4.99
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.17
vs 25 benchmark
ROA
Return on assets percentage
0.01
vs 25 benchmark
ROCE
Return on capital employed
0.02
vs 25 benchmark
How NTRS Stacks Against Its Sector Peers
| Metric | NTRS Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 15.75 | 21.10 | Better (Cheaper) |
| ROE | 17.14% | 652.00% | Weak |
| Net Margin | 14.76% | -1585.00% (disorted) | Strong |
| Debt/Equity | 1.18 | 0.91 | Weak (High Leverage) |
| Current Ratio | 4.99 | 910.69 | Strong Liquidity |
| ROA | 1.25% | -574.00% (disorted) | Weak |
NTRS outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Northern Trust Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
152.10%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
59.55%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
224.06%
Industry Style: Value, Dividend, Cyclical
High Growth