Shares of State Street ( STT) of Boston rose 3.5% to close at $55.25. The company on Friday reported fourth-quarter operating earnings available to common shareholders of $521 million, or $1.11 a share, increasing from $473 million, or 99 cents a share, in the third quarter, and $454 million, or 93 cents a share, in the fourth quarter of 2011. The adjusted fourth-quarter earnings excluded $139 million in acquisition and restructuring costs, mainly related to the reduction of 630 staff positions, which will be completed this year. Highlights for the quarter included $260 million in investment management fees, increasing 4% sequentially and 29% year-over-year, ""primarily due to stronger equity markets, net new business, and higher performance fees." Please see TheStreet's earnings coverage for more detail on State Street's fourth-quarter results. Guggenheim analyst Marty Mosby rates State Street a "Buy," with a $57 price target, and on Tuesday said that "as the operating environment stabilizes going into 2013, revenue growth should continue; furthermore, positive efficiencies should continue to build and excess capital should be deployed through either share repurchases or acquisitions." "As a result, we expect STT to be able to grow operating earnings per share by about 10% in 2013 and improve operating return on tangible common equity back toward 18%." State Street's shares have already risen 18% year-to-date, following a 19% return during 2012. The shares trade for 12.6 times the consensus 2013 EPS estimate of $4.38. The consensus 2014 EPS estimate is $4.98. Based on a quarterly payout of 24 cents, the shares have a dividend yield of 1.74%. Interested in more on State Street? See TheStreet Ratings' report card for this stock.
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