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TheStreet Open House

10 Bank Stocks You Need to Watch During Earnings Season (Update 1)

4. Bank of New York Mellon
Shares of Bank of New York Mellon (BK) closed at $21.95 Friday, returning 12% year-to-date, following a 33% decline during 2011.

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Based on a quarterly payout of 13 cents, the shares have a dividend yield of 2.37%.

The shares trade for 2.2 times tangible book value, and for 8.9 times the consensus 2013 EPS estimate of $2.47. The consensus 2012 EPS estimate is $2.21.

The company plans to repurchase up to $1.16 billion in common shares this year, and reported buying back "17.3 million common shares in the open market at an average price of $21.53 per share for a total of $371 million," during the first quarter.

Analysts expect Bank of New York Mellon to report second-quarter earnings of 54 cents a share, improving from 52 cents the previous quarter, but declining from 59 cents a year earlier.

KBW analyst Robert Lee rates Bank of New York Mellon "Market Perform," with a $26 price target, saying on Wednesday that "to some extent BK may be the most levered of the trust and custody banks to near-term capital markets activity (both good and bad), particularly debt issuance, and M&A and trading volumes," adding that "asset management should enjoy positive long-term inflows, although given BK's size, the incremental impact of modest changes in net flows, particularly into lower-fee indexed and fixed income products, is minimal."

KBW estimates that Bank of New York Mellon will report second-quarter earnings of 51 cents, with EPS estimate of $2.15 for all of 2012, and $2.45 in 2013.

Interested in more on Bank of New York Mellon? See TheStreet Ratings' report card for this stock.

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