Yahoo Finance The Bank of New York Mellon Corporation Just Recorded A 17% EPS Beat: Here's What Analysts Are Forecasting Next
The Bank of New York Mellon Corporation (NYSE:BK) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 6.2% to hit US$4.1b. Bank of New York Mellon reported statutory earnings per share (EPS) US$1.05, which was a notable 17% above what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for Bank of New York Mellon
Taking into account the latest results, the 13 analysts covering Bank of New York Mellon provided consensus estimates of US$15.5b revenue in 2020, which would reflect a measurable 6.1% decline on its sales over the past 12 months. Statutory earnings per share are forecast to nosedive 22% to US$3.62 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$15.5b and earnings per share (EPS) of US$3.61 in 2020. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$42.36, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Bank of New York Mellon, with the most bullish analyst valuing it at US$54.00 and the most bearish at US$36.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Bank of New York Mellon's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with the forecast 6.1% revenue decline a notable change from historical growth of 1.5% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 3.8% next year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Bank of New York Mellon is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. The consensus price target held steady at US$42.36, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Bank of New York Mellon going out to 2022, and you can see them free on our platform here.
Plus, you should also learn about the 2 warning signs we've spotted with Bank of New York Mellon (including 1 which is concerning) .
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