NEW YORK—J. Kevin McCarthy, the Senior Executive Vice President and General Counsel at Bank of New York Mellon Corp (NYSE:BK), has sold 25,000 shares of common stock. The shares were sold at a weighted average price of $76.3149, with the actual sale prices ranging from $76.280 to $76.405. This transaction, which occurred on October 15, 2024, amounted to approximately $1.9 million. Following the sale, McCarthy holds 75,403.81 shares in the company.
In other recent news, Bank of New York Mellon (BNY Mellon) reported a robust third-quarter performance, with a 22% year-over-year increase in earnings per share (EPS) to $1.50, and a 5% rise in total revenue, reaching $4.6 billion. The bank's Clearance and Collateral Management (CCM) segment significantly contributed to this growth. The bank's management also expects a fourth-quarter net interest income (NII) of approximately $1 billion, in line with consensus estimates.
In addition, BNY Mellon has made strategic advancements with the acquisition of Archer to enhance its asset servicing capabilities and demonstrated a commitment to AI investment by establishing a dedicated hub with several hundred employees.
On the analyst front, several firms have adjusted their outlook on BNY Mellon. Citi maintained a Neutral rating, while Deutsche Bank and JPMorgan have maintained a Buy and Overweight rating respectively, with Barclays and Evercore ISI retaining an Overweight and In Line rating respectively. These updates followed the bank's strong third-quarter performance.
The bank's management has increased its full-year net interest income (NII) forecast to a 5% year-over-year decrease, which is more optimistic than the consensus estimate of a 6.5% decline. Furthermore, they do not foresee NII posing a challenge in 2025, projecting an increase of 3-4% year-over-year for the next year.
Finally, Citi anticipates that BNY Mellon will deliver returns in the low-to-mid twenties percent range for 2025, with a payout ratio of approximately 100%. The expected pace of share buybacks is estimated at around $800 million per quarter.
InvestingPro Insights
The recent stock sale by J. Kevin McCarthy comes at a time when Bank of New York Mellon (BK) is experiencing strong market performance. According to InvestingPro data, BK's stock is trading near its 52-week high, with a remarkable 83.84% price total return over the past year. This aligns with the company's robust financial health, as evidenced by its $56.49 billion market capitalization and a revenue of $17.8 billion in the last twelve months.
InvestingPro Tips highlight that BK has raised its dividend for 14 consecutive years, demonstrating a commitment to shareholder value. The company's current dividend yield stands at 2.43%, with a notable dividend growth of 11.9% in the last twelve months. This consistent dividend policy may be attractive to income-focused investors.
However, investors should note that the stock's RSI suggests it may be in overbought territory, which could indicate a potential for price consolidation in the near term. Additionally, BK is trading at a high P/E ratio relative to its near-term earnings growth, with a P/E ratio of 17.47 and a PEG ratio of 4.52 for the last twelve months.
For those interested in a deeper analysis, InvestingPro offers 12 additional tips for Bank of New York Mellon, providing a more comprehensive view of the company's financial position and market outlook.
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