Northern Trust shares should continue climb: Barrons
NEW YORK (Reuters) - Banking company Northern Trust Corp (NTRS.O), which caters to the rich and super rich, could see its shares climb 10 percent or more annually in the coming years, according to a report in Barron's financial newspaper.
Shares of Northern Trust, which has managed to largely avoid the pitfalls of the housing and credit crises, have climbed 19 percent in the last six months, while the KBW index of major bank shares is down 11 percent, Barron's noted in its November 5 edition. But the stock still has room to run, due to strong demand for private banking and institutional financial services, the newspaper said.
"In a more troubled environment, there is going to be more demand for their services, and some of their potential rivals have their own internal problems to overcome," Alois Pirker, analyst for Aite Group in Boston told Barron's.
While the stock is trading at a relatively expensive 19 times estimated earnings for the next 12 months, Northern trades at a discount to its long-term average price to earnings ratio of 24.5, and projected annual earnings growth of 12 percent could go a long way to justifying the multiple, the newspaper said.
(Reporting by Bill Berkrot)
