NEW YORK (TheStreet) -- Shares of Bank of New York Mellon Corp. (BK) are down -1.57% to $33.93 after it was reported that Mitsubishi UFJ Financial Group Inc. (MTU) may bid for the bank's corporate trust arm, sources told Bloomberg.
It was not clear what Mitsubishi UFJ would offer as the custody bank is working with Goldman Sachs Group (GS) to find buyers for the unit, which could be worth $2.5 billion or more, according to Bloomberg.
Shares of Mitsubishi UFJ are up slightly.
TheStreet Ratings team rates BANK OF NEW YORK MELLON CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate BANK OF NEW YORK MELLON CORP (BK) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, attractive valuation levels, expanding profit margins and compelling growth in net income. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- BK's revenue growth has slightly outpaced the industry average of 7.9%. Since the same quarter one year prior, revenues slightly increased by 0.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The gross profit margin for BANK OF NEW YORK MELLON CORP is currently very high, coming in at 98.23%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.06% is above that of the industry average.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 366.4% when compared to the same quarter one year prior, rising from -$253.00 million to $674.00 million.
- You can view the full analysis from the report here: BK Ratings Report