10Y annualized return is
positive but below market average
at 6.6% per year
BK has met or exceeded earnings expectations in
most
recent quarters (9/10)
Attractive PE Ratio
Reasonable Price to Book Ratio
Strong Profit Margins
Solid Return on Equity
Low Debt Levels
Strong Financial Performance
Diversified Business Model
Effective Operational Transformation
Growth in Wealth Management
Investment in Technology and AI
Positive Operating Leverage Outlook
High Price to Cash Flow Ratio
Negative EV Multiples
Low Operating Profit Margin
Liquidity Concerns
Weak Interest Coverage
High Operational Change Risk
Market Uncertainty Risks
Dependency on Market Conditions
Overall, BNY demonstrates strong business quality with a solid financial performance, diversified operations, and strategic transformation efforts. However, the risks associated with operational changes and market uncertainties could pose challenges. Future prospects are promising with ongoing investments in technology and a focus on high-growth segments, though reliant on favorable market conditions.
Analysis Date: January 15, 2025
Last Updated: March 11, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
The Bank of New York Mellon Corporation, often called BNY Mellon, helps manage money for a variety of clients, including businesses and wealthy individuals. They offer services like keeping track of investments, handling payments, and helping with financial planning. Think of them as a helper for organizations and people who want to grow and protect their money. Founded in 1784, they have a long history of providing these important financial services.
Streams of revenue
Geographic Distribution
Core Products
Business Type
Business to Business
Competitive Advantages
Key Business Risks
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$240.04
Current Market Price: $72.44
IV/P Ratio: 3.31x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
70.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for BK
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (11.76)
P/B ratio ≤ 1.5 (1.29)
Current ratio ≥ 2.0 (0.65x)
Long-term debt < Net current assets (-0.27x)
Margin of safety (70.0%)
BK does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
11.00%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
99.48%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
24.69%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
The gross profit margin of 99.48% and net profit margin of 24.69% indicate robust profitability, showcasing the company's ability to convert sales into actual profit.
A return on equity of 11.00% is indicative of effective management in generating profits from shareholders' equity.
The operating profit margin of 23.15% suggests that although the company is profitable, there may be concerns regarding operational efficiency.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
1.09x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
0.65x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
The debt to equity ratio of 0.76 and debt to assets of 0.08 indicate a relatively low level of debt, which suggests financial stability.
Current, quick, and cash ratios of 0.0 indicate significant liquidity issues, suggesting that the company may struggle to meet short-term obligations.
An interest coverage ratio of 0.20 indicates that the company may have difficulty covering interest expenses, which poses a risk to financial health.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
BNY reported record net income of $4.3 billion and record revenue of $18.6 billion in 2024. The return on tangible common equity was 23%, showcasing strong profitability.
BNY has a strong presence across various financial sectors including treasury services, collateral management, and wealth management, positioning it well to capture growth in a range of market conditions.
The company is implementing a 'platform operating model' which aims to enhance efficiency and client service through better integration of services, resulting in improved employee satisfaction and operational efficiencies.
The transition to the new operating model may lead to disruptions and requires significant training and adjustment, which could temporarily impact performance and employee productivity.
The wealth management segment is focused on the growing ultra-high net worth client base, with potential for strong future growth given the rising demand in the US wealth market.
BNY is increasing investments in technology and AI, which are expected to enhance efficiency and drive revenue growth in the long term.
The company aims to achieve mid-single-digit growth in net interest income and fee revenue in 2025, indicating strong growth potential despite market uncertainties.
While there are growth prospects, persistent geopolitical tensions, trade uncertainties, and potential market volatility could negatively impact performance.
The growth of certain segments, particularly wealth management, is highly influenced by market performance, which is uncertain and could lead to fluctuations in revenue.