Value
6.3/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 7.0 |
| P/S | 7.7 |
| Fwd P/E | 8.1 |
| PEG | 5.5 |
| Analyst target | 3.0 |
- ▸Forward P/E: 14.7x
- ▸PEG: 1.36
NTRS · Why this verdict
Why Northern Trust (NTRS) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.2/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Northern Trust has delivered a perfect 4-quarter earnings beat streak with a growth score of 8.0, strong margins of 22%, and peer-leading growth rankings, but the stock has reached its analyst price target with a negative asymmetry ratio of -2.2, making near-term entry unattractive without a price correction.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Northern Trust achieved a growth score of 8.0 with revenue growing 6% and earnings growing at a strong pace, while delivering a perfect 4-quarter earnings beat streak with an average positive surprise of 6.0%, demonstrating consistent execution in asset management. Growth breakdown | Earnings beat rate continues at 4 out of 4 quarters with average positive surprise above 4% and growth score remains above 7.0 over the next four reporting periods. | →Stable |
| CounterAsset management revenue is highly sensitive to market levels; a 20% market drawdown would reduce assets under management and fee revenue proportionally, compressing earnings and breaking the beat streak. | ||
Northern Trust generates net margins of 22% and holds a Piotroski F-Score of 8/9, with operating margins scoring a maximum 10 on quality components, reflecting the fee-based nature of its institutional asset management and custody business. Quality breakdown | Net margins remain above 18% and Piotroski F-Score stays at 7 or above over the next 12 months. | →Stable |
| CounterHigh margins in asset management are under structural pressure from fee compression as passive strategies and institutional fee negotiations continue to reduce revenue per dollar of assets under management. | ||
The stock has moved to its analyst target price with essentially zero upside remaining (-0.1% to take profit), and the asymmetry ratio is negative at -2.17, meaning the downside risk of 4.9% significantly exceeds any price upside at current levels. Warnings | Either the price corrects to create at least 10% upside to the analyst target, or analyst price targets are raised by at least 15% above the current price of $172.72 within 12 months. | →Stable |
| CounterThe breakout setup with golden cross and above-all-moving-averages positioning, combined with positive news sentiment of +0.70, suggests the stock can continue higher even beyond current targets. | ||
Northern Trust ranks highly versus peers on the growth dimension at 7.44 in the peer rank growth component, suggesting it is gaining share in the institutional asset management sector relative to competitors. Peer-rank breakdown | Peer-relative growth ranking remains in the top quartile of the financial services peer group over the next 12 months. | →Stable |
| CounterPeer-relative growth rankings can shift quickly in the asset management sector based on product mix and client base; any institutional mandate losses could rapidly erode the relative growth advantage. | ||
Northern Trust achieved a growth score of 8.0 with revenue growing 6% and earnings growing at a strong pace, while delivering a perfect 4-quarter earnings beat streak with an average positive surprise of 6.0%, demonstrating consistent execution in asset management.
→StableGrowth breakdown
- Expectation
- Earnings beat rate continues at 4 out of 4 quarters with average positive surprise above 4% and growth score remains above 7.0 over the next four reporting periods.
CounterAsset management revenue is highly sensitive to market levels; a 20% market drawdown would reduce assets under management and fee revenue proportionally, compressing earnings and breaking the beat streak.
Northern Trust generates net margins of 22% and holds a Piotroski F-Score of 8/9, with operating margins scoring a maximum 10 on quality components, reflecting the fee-based nature of its institutional asset management and custody business.
→StableQuality breakdown
- Expectation
- Net margins remain above 18% and Piotroski F-Score stays at 7 or above over the next 12 months.
CounterHigh margins in asset management are under structural pressure from fee compression as passive strategies and institutional fee negotiations continue to reduce revenue per dollar of assets under management.
The stock has moved to its analyst target price with essentially zero upside remaining (-0.1% to take profit), and the asymmetry ratio is negative at -2.17, meaning the downside risk of 4.9% significantly exceeds any price upside at current levels.
→StableWarnings
- Expectation
- Either the price corrects to create at least 10% upside to the analyst target, or analyst price targets are raised by at least 15% above the current price of $172.72 within 12 months.
CounterThe breakout setup with golden cross and above-all-moving-averages positioning, combined with positive news sentiment of +0.70, suggests the stock can continue higher even beyond current targets.
Northern Trust ranks highly versus peers on the growth dimension at 7.44 in the peer rank growth component, suggesting it is gaining share in the institutional asset management sector relative to competitors.
→StablePeer-rank breakdown
- Expectation
- Peer-relative growth ranking remains in the top quartile of the financial services peer group over the next 12 months.
CounterPeer-relative growth rankings can shift quickly in the asset management sector based on product mix and client base; any institutional mandate losses could rapidly erode the relative growth advantage.
Per-dimension breakdown
Quality
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.8 |
| ROA | 0.7 |
| Gross margin | 0.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Moat | 5.9 |
| Piotroski F | 8.9 |
- ▸Strong margins: 22%
- ▸Strong Piotroski F-Score: 8/9
Growth
8.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.0 |
| EPS growth | 10.0 |
Momentum
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.0 |
| Analyst rating | 5.0 |
| Price target | 4.4 |
- ▸LLM news sentiment: +0.40 (n=1)
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸Insider selling (low materiality) — $4,361,688 (0.014% of mkt cap)
Peer rank
5.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.1 |
| quality rank | 5.4 |
| growth rank | 7.4 |
Technical
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.7 |
| support resistance | 0.6 |
| 52w position | 9.9 |
Risk (lower is worse)
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.2 |
| days to cover | 8.6 |
| volatility | 6.9 |
| put call | 9.8 |
| implied vol | 7.0 |
| max pain risk | 3.0 |
| beta | 5.9 |
- ▸Above max pain $70
Catalyst
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 5.6 |
| dividend safety | 5.2 |
| news activity | 5.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend: 184.0%
How the verdict was assembled
Engine trigger
Downgraded from BUY WAIT — price $177.72 has reached target $175.13. No upside to wait for.
Engine technical detail
verdict_path:
L4:PATH_F_HOLD|L3:NEWS_MOD=+2|SANITY:WAIT+price>=TPPassed (7)
- MOMENTUM:6.9>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.40
- EARNINGS_PROXIMITY:26d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-2.0=NEGATIVE
Warning (0)
none
Reward-to-Risk
-2.00
Upside
-16.3%
Downside
8.1%
Sizing output
AVOID
SetupBREAKOUT — Golden cross, above all MAs, RSI 58, MACD bullish
EdgeCATALYST — Earnings in 26d with 4/4 beat streak
SuitabilityMODERATE — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:6.9>=5.5. Top dim: Growth at 8.0; weakest: Technical at 3.7. No conviction either direction.
The strongest dimensions are Growth at 8.0, Risk (lower is worse) at 7.2, and Momentum at 6.9; the weakest are Technical at 3.7, Insider at 5.0, and Sentiment at 5.5. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -2.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Northern Trust achieved a growth score of 8.0 with revenue growing 6% and earnings growing at a strong pace, while delivering a perfect 4-quarter earnings beat streak with an average positive surprise of 6.0%, demonstrating consistent execution in asset management.
Trip ifEPS surprise falls below 0% in at least 2 of the next 4 quarters or revenue growth falls below 3% year-over-year.
- P2Northern Trust generates net margins of 22% and holds a Piotroski F-Score of 8/9, with operating margins scoring a maximum 10 on quality components, reflecting the fee-based nature of its institutional asset management and custody business.
Trip ifNet margin falls below 15% for 2 consecutive quarters.
- P3The stock has moved to its analyst target price with essentially zero upside remaining (-0.1% to take profit), and the asymmetry ratio is negative at -2.17, meaning the downside risk of 4.9% significantly exceeds any price upside at current levels.
Trip ifStock price rises above $180 without analyst targets being raised above $180.
- P4Northern Trust ranks highly versus peers on the growth dimension at 7.44 in the peer rank growth component, suggesting it is gaining share in the institutional asset management sector relative to competitors.
Trip ifPeer-relative growth ranking falls below the 50th percentile for 2 consecutive quarters.