Rating Change #2

Bank Of New York Mellon ( BK) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The debt-to-equity ratio is somewhat low, currently at 0.93, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • The gross profit margin for BANK OF NEW YORK MELLON CORP is currently very high, coming in at 96.00%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 16.30% is above that of the industry average.
  • Despite the weak revenue results, BK has outperformed against the industry average of 21.0%. Since the same quarter one year prior, revenues slightly dropped by 0.6%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • BANK OF NEW YORK MELLON CORP's earnings per share improvement from the most recent quarter was slightly positive. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, BANK OF NEW YORK MELLON CORP reported lower earnings of $2.04 versus $2.10 in the prior year. This year, the market expects an improvement in earnings ($2.25 versus $2.04).
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The Bank of New York Mellon Corporation, a financial services company, provides various products and services worldwide. The company offers a range of equity, fixed income, cash, and alternative/overlay products, as well as distributes investment management products. The company has a P/E ratio of 11.7, above the average financial services industry P/E ratio of 11.5 and below the S&P 500 P/E ratio of 17.7. Bank of New York Mellon has a market cap of $28.03 billion and is part of the financial sector and financial services industry. Shares are up 15.9% year to date as of the close of trading on Thursday.

You can view the full Bank of New York Mellon Ratings Report or get investment ideas from our investment research center.

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