NTRS - Northern Trust Corporation
Price:
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CONSENSUS:
Hold
DETAILS
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PRICE TARGET:
$168.40
DETAILS
HIGH:
$186.00
LOW:
$148.00
MEDIAN:
$170.00
CONSENSUS:
$168.40
DOWNSIDE:
8.51%
AlphaVal
Deterministic, archetype-aware fair value
Banks, Insurers & Asset Managers
85% confidence
Primary model: P/Tangible Book × ROE Quality
Adjust Assumptions
14.2%
11.2%
Key Value Driver
ROTCE (14.2%) vs. cost of equity (11.2%)
Implied Market Multiple
2.78x
Plain-Language Summary
Our base-case estimate uses P/Tangible Book × ROE Quality. We then blend that result with the average analyst price target of $168.40 from 35 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $125.49 per share.
Warnings
Traditional cash flow models don't work well for banks — lending activity distorts how much cash the business actually generates.
Common valuation shortcuts don't apply here — for banks, interest payments are a core business cost, not overhead.
Dividend-based valuation: $38.56 (64% below our primary estimate). Large gaps suggest the dividend may not fully reflect the company's value.
Wall Street's average price target is $168.40 (from 35 analysts). Our estimate is 36% below the consensus -- consider that gap carefully.
Key Risks
- Book value quality matters as much as level — check loan loss reserves
- Interest rate sensitivity creates non-linear earnings surprises
- Insurance reserving is actuarial, not financial — errors emerge slowly