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GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength : 4/10

vs
industry
vs
history
Cash to Debt 6.20
BK's Cash to Debt is ranked lower than
71% of the 1212 Companies
in the Global Asset Management industry.

( Industry Median: 9999.00 vs. BK: 6.20 )
Ranked among companies with meaningful Cash to Debt only.
BK' s 10-Year Cash to Debt Range
Min: 0.54  Med: 1.76 Max: 7.18
Current: 6.2
0.54
7.18
Equity to Asset 0.10
BK's Equity to Asset is ranked lower than
95% of the 1265 Companies
in the Global Asset Management industry.

( Industry Median: 0.86 vs. BK: 0.10 )
Ranked among companies with meaningful Equity to Asset only.
BK' s 10-Year Equity to Asset Range
Min: 0.07  Med: 0.10 Max: 0.16
Current: 0.1
0.07
0.16
Interest Coverage 10.06
BK's Interest Coverage is ranked lower than
83% of the 1131 Companies
in the Global Asset Management industry.

( Industry Median: 10000.00 vs. BK: 10.06 )
Ranked among companies with meaningful Interest Coverage only.
BK' s 10-Year Interest Coverage Range
Min: 0.72  Med: 1.45 Max: 10.82
Current: 10.06
0.72
10.82
F-Score: 5
GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth : 7/10

vs
industry
vs
history
Operating margin (%) 25.82
BK's Operating margin (%) is ranked lower than
64% of the 1363 Companies
in the Global Asset Management industry.

( Industry Median: 51.91 vs. BK: 25.82 )
Ranked among companies with meaningful Operating margin (%) only.
BK' s 10-Year Operating margin (%) Range
Min: -28.72  Med: 31.60 Max: 56.83
Current: 25.82
-28.72
56.83
Net-margin (%) 18.38
BK's Net-margin (%) is ranked lower than
64% of the 1369 Companies
in the Global Asset Management industry.

( Industry Median: 46.05 vs. BK: 18.38 )
Ranked among companies with meaningful Net-margin (%) only.
BK' s 10-Year Net-margin (%) Range
Min: -14.1  Med: 21.67 Max: 44.14
Current: 18.38
-14.1
44.14
ROE (%) 7.51
BK's ROE (%) is ranked higher than
56% of the 1412 Companies
in the Global Asset Management industry.

( Industry Median: 6.08 vs. BK: 7.51 )
Ranked among companies with meaningful ROE (%) only.
BK' s 10-Year ROE (%) Range
Min: -4.79  Med: 15.31 Max: 32.84
Current: 7.51
-4.79
32.84
ROA (%) 0.75
BK's ROA (%) is ranked lower than
68% of the 1431 Companies
in the Global Asset Management industry.

( Industry Median: 3.77 vs. BK: 0.75 )
Ranked among companies with meaningful ROA (%) only.
BK' s 10-Year ROA (%) Range
Min: -0.48  Med: 1.36 Max: 2.93
Current: 0.75
-0.48
2.93
Revenue Growth (3Y)(%) 4.70
BK's Revenue Growth (3Y)(%) is ranked lower than
51% of the 783 Companies
in the Global Asset Management industry.

( Industry Median: 5.30 vs. BK: 4.70 )
Ranked among companies with meaningful Revenue Growth (3Y)(%) only.
BK' s 10-Year Revenue Growth (3Y)(%) Range
Min: -9.9  Med: 6.30 Max: 23.7
Current: 4.7
-9.9
23.7
EBITDA Growth (3Y)(%) 6.00
BK's EBITDA Growth (3Y)(%) is ranked higher than
50% of the 647 Companies
in the Global Asset Management industry.

( Industry Median: 5.30 vs. BK: 6.00 )
Ranked among companies with meaningful EBITDA Growth (3Y)(%) only.
BK' s 10-Year EBITDA Growth (3Y)(%) Range
Min: -19  Med: 6.40 Max: 22.5
Current: 6
-19
22.5
EPS Growth (3Y)(%) 1.90
BK's EPS Growth (3Y)(%) is ranked lower than
58% of the 618 Companies
in the Global Asset Management industry.

( Industry Median: 8.10 vs. BK: 1.90 )
Ranked among companies with meaningful EPS Growth (3Y)(%) only.
BK' s 10-Year EPS Growth (3Y)(%) Range
Min: -18.3  Med: 5.80 Max: 23.7
Current: 1.9
-18.3
23.7
» BK's 10-Y Financials

Financials


Revenue & Net Income
Equity & Asset
Oprt. Cash Flow & Free Cash Flow

» Details

Guru Trades

Q3 2014

BK Guru Trades in Q3 2014

Caxton Associates 75,600 sh (New)
Andreas Halvorsen 16,735,985 sh (New)
Paul Tudor Jones 21,828 sh (+96.65%)
Jeremy Grantham 346,400 sh (+53.00%)
John Rogers 116,715 sh (+3.46%)
Bill Nygren 6,450,000 sh (+2.06%)
First Eagle Investment 27,718,354 sh (+2.01%)
Mario Gabelli 6,478,035 sh (+1.39%)
John Buckingham 164,590 sh (+0.09%)
Robert Olstein 213,000 sh (unchged)
Chuck Royce 1,360 sh (unchged)
Brian Rogers 200,000 sh (unchged)
Warren Buffett 23,377,603 sh (unchged)
Ken Fisher 10,637 sh (unchged)
Pioneer Investments 18,528 sh (unchged)
Yacktman Focused Fund 2,250,000 sh (unchged)
Yacktman Fund 4,200,000 sh (unchged)
NWQ Managers 187,050 sh (unchged)
James Barrow Sold Out
Diamond Hill Capital Sold Out
Donald Yacktman 7,750,709 sh (-0.12%)
Jeff Auxier 352,454 sh (-0.20%)
Murray Stahl 38,317 sh (-0.26%)
Tweedy Browne 4,154,803 sh (-0.67%)
Dodge & Cox 67,150,764 sh (-0.70%)
David Dreman 52,480 sh (-3.40%)
Charles Brandes 3,730,171 sh (-5.93%)
Chris Davis 61,887,826 sh (-6.84%)
Third Avenue Management 4,491,797 sh (-10.67%)
HOTCHKIS & WILEY 5,244,262 sh (-15.06%)
Mason Hawkins 16,535,281 sh (-52.14%)
First Pacific Advisors 1,096,500 sh (-67.89%)
Steven Romick 1,021,000 sh (-68.14%)
Martin Whitman 3,034,813 sh (-4.55%)
» More
Q4 2014

BK Guru Trades in Q4 2014

Caxton Associates 121,300 sh (+60.45%)
Charles Brandes 3,776,416 sh (+1.24%)
HOTCHKIS & WILEY 5,279,318 sh (+0.67%)
Dodge & Cox 67,339,717 sh (+0.28%)
First Eagle Investment 27,760,645 sh (+0.15%)
NWQ Managers 187,295 sh (+0.13%)
Mario Gabelli 6,479,128 sh (+0.02%)
John Buckingham 164,625 sh (+0.02%)
Robert Olstein 213,000 sh (unchged)
Ken Fisher 10,637 sh (unchged)
Bill Nygren 6,450,000 sh (unchged)
Brian Rogers 200,000 sh (unchged)
Yacktman Fund 4,200,000 sh (unchged)
Dodge & Cox 67,339,717 sh (unchged)
Yacktman Focused Fund 2,250,000 sh (unchged)
Chris Davis 54,870,475 sh (unchged)
Chuck Royce 1,360 sh (unchged)
Martin Whitman 3,034,813 sh (unchged)
Pioneer Investments Sold Out
Steven Romick Sold Out
First Pacific Advisors Sold Out
Jeff Auxier 352,204 sh (-0.07%)
John Rogers 116,515 sh (-0.17%)
Donald Yacktman 7,731,284 sh (-0.25%)
Murray Stahl 38,117 sh (-0.52%)
Tweedy Browne 4,120,768 sh (-0.82%)
David Dreman 51,757 sh (-1.38%)
Warren Buffett 22,012,603 sh (-5.84%)
Third Avenue Management 4,102,532 sh (-8.67%)
Chris Davis 54,870,475 sh (-11.34%)
Jeremy Grantham 291,800 sh (-15.76%)
Paul Tudor Jones 17,924 sh (-17.89%)
Andreas Halvorsen 11,866,061 sh (-29.10%)
Mason Hawkins 7,715,683 sh (-53.34%)
» More
Q1 2015

BK Guru Trades in Q1 2015

David Einhorn 330,901 sh (New)
Robert Olstein 236,000 sh (+10.80%)
Jeremy Grantham 309,600 sh (+6.10%)
Paul Tudor Jones 18,500 sh (+3.21%)
Mario Gabelli 6,563,109 sh (+1.30%)
First Eagle Investment 27,942,789 sh (+0.66%)
John Rogers 116,615 sh (+0.09%)
Yacktman Focused Fund 2,250,000 sh (unchged)
Bill Nygren 6,450,000 sh (unchged)
Brian Rogers 200,000 sh (unchged)
Caxton Associates Sold Out
Chuck Royce Sold Out
John Buckingham 164,503 sh (-0.07%)
Dodge & Cox 67,054,467 sh (-0.42%)
Tweedy Browne 4,095,096 sh (-0.62%)
Yacktman Fund 4,150,000 sh (-1.19%)
Donald Yacktman 7,546,108 sh (-2.40%)
Ken Fisher 10,379 sh (-2.43%)
Charles Brandes 3,677,934 sh (-2.61%)
David Dreman 49,444 sh (-4.47%)
NWQ Managers 177,100 sh (-5.44%)
Warren Buffett 20,680,420 sh (-6.05%)
Andreas Halvorsen 11,111,499 sh (-6.36%)
Mason Hawkins 7,215,441 sh (-6.48%)
Third Avenue Management 3,672,724 sh (-10.48%)
Murray Stahl 30,567 sh (-19.81%)
Chris Davis 43,466,525 sh (-20.78%)
HOTCHKIS & WILEY 3,371,212 sh (-36.14%)
Jeff Auxier 121,079 sh (-65.62%)
Martin Whitman 2,798,013 sh (-7.80%)
» More
Q2 2015

BK Guru Trades in Q2 2015

Ray Dalio 39,210 sh (New)
Larry Robbins 3,505,051 sh (New)
John Burbank 5,892 sh (New)
John Keeley 5,741 sh (New)
Jim Simons 513,377 sh (New)
David Einhorn 4,000,000 sh (+1108.82%)
Jeff Auxier 345,054 sh (+184.98%)
Paul Tudor Jones 19,600 sh (+5.95%)
Mario Gabelli 6,682,894 sh (+1.83%)
John Rogers 117,915 sh (+1.11%)
Ken Fisher 10,424 sh (+0.43%)
John Buckingham 164,643 sh (+0.09%)
Robert Olstein 236,000 sh (unchged)
Brian Rogers 200,000 sh (unchged)
Warren Buffett 20,680,420 sh (unchged)
Bill Nygren 6,450,000 sh (unchged)
Mason Hawkins Sold Out
Tweedy Browne 4,090,263 sh (-0.12%)
Murray Stahl 30,442 sh (-0.41%)
First Eagle Investment 27,491,214 sh (-1.62%)
Charles Brandes 3,588,945 sh (-2.42%)
David Dreman 48,186 sh (-2.54%)
Yacktman Fund 4,000,000 sh (-3.61%)
NWQ Managers 166,250 sh (-6.13%)
Third Avenue Management 3,350,437 sh (-8.78%)
Donald Yacktman 6,881,548 sh (-8.81%)
Dodge & Cox 58,218,752 sh (-13.18%)
Jeremy Grantham 251,100 sh (-18.90%)
Yacktman Focused Fund 1,800,000 sh (-20.00%)
Andreas Halvorsen 8,413,291 sh (-24.28%)
HOTCHKIS & WILEY 2,528,165 sh (-25.01%)
Chris Davis 30,458,796 sh (-29.93%)
Martin Whitman 2,424,813 sh (-13.34%)
» More
» Details

Insider Trades

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Preferred stocks of Bank of New York Mellon Corp

SymbolPriceYieldDescription
BKNML950.005.20
BKPRC24.725.26Deposit Shs Repr 1/4000 5.2 % Non Cum Pfd Shs Series -C- PDF

Guru Investment Theses on Bank of New York Mellon Corp

Mason Hawkins Comments on Bank of New York Mellon - Oct 17, 2014

Bank of New York Mellon (BK) gained 4% in the quarter and 12% YTD. Expense controls helped results, although low market volatility and low rates this year have hampered revenue growth in asset services. The asset management business grew steadily along with the markets. The company emphasized the substantial earnings power that modest interest rate increases will create as money market fee waivers will end and net interest margins will expand. During the quarter BK repurchased almost 1% of outstanding shares, approximately one-third of the total buyback approved by the Federal Reserve.

From Mason Hawkins (Trades, Portfolio)’ Longleaf Partners Q3 2014 Management Discussion.

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Chris Davis Comments on Bank of New York Mellon - Sep 08, 2014

Bank of New York Mellon (BK) is a third example of the type of financial services businesses that Davis Advisors finds attractive. This company is a behind-the-scenes giant in the mundane yet durable businesses of trust services, asset custody, transaction processing, and asset management. While less widely understood than its traditional banking peers, Bank of New York Mellon is at the forefront of its industry in size and depth, operating in 35 countries with a leading $27.9 trillion under custody and/or administration. Although not in a glamorous industry, we believe its business lines are profitable, scalable, less risky, and less capital intensive than traditional banking with good long-term growth potential worldwide.

From Chris Davis (Trades, Portfolio)’ Davis Financial Fund Semi-Annual Review 2014.



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Mario Gabelli Comments on Bank of New York Mellon Corp - Jul 25, 2014

The Bank of New York Mellon Corp. (BK) (1.3% of net assets as of June 30, 2014) (BK - $37.48 - NYSE) is a global leader in providing financial services to institutions and individuals. The company operates in over one hundred markets worldwide and strives to be the global provider of choice for investment management and investment services. As of December 31, 2013, the firm had $27.6 trillion in assets under custody and $1.6 trillion in assets under management. Going forward, we expect BNY Mellon to benefit from rising global incomes and the cross border movement of financial transactions.

From Mario Gabelli (Trades, Portfolio)’s The Gabelli Equity Income Fund Second Quarter 2014 Shareholder Commentary.

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Third Avenue Management Comments on Bank of New York Mellon - Jul 23, 2014

BNY Mellon (BK) ("BK") participates in two businesses –asset management and investment servicing. The company had $1.6 trillion in assets under management and $27.9 trillion of asset under custody and/or administration, as of March 31, 2014. The businesses seem separable and more valuable on a sum-of-the-parts basis. The asset management business with its iconic Dreyfus Funds and stable of boutique managers could certainly be a stand- alone entity or would seem to attract interest from strategic or financial buyers. BK has been in the news recently given more shareholder scrutiny of its operating efficiency. Recently, there have been news reports that BK could be looking to sell its Corporate Trust unit, which has been a detractor due to the run-off of high-margin securitizations.

From Martin Whitman (Trades, Portfolio)'s 2Q 2014 Shareholder Letters.

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Third Avenue Management Comments on BNY Mellon - Jun 06, 2014

BNY Mellon (NYSE:BK)("BK") participates in two businesses –asset management and investment servicing. The company had $1.6 trillion in assets under management and $27.9 trillion of asset under custody and/or administration, as of March 31, 2014. The businesses seem separable and more valuable on a sum-of-the-parts basis. The asset management business with its iconic Dreyfus Funds and stable of boutique managers could certainly be a stand- alone entity or would seem to attract interest from strategic or financial buyers. BK has been in the news recently given more shareholder scrutiny of its operating efficiency. recently, there have been news reports that BK could be looking to sell its Corporate Trust unit, which has been a detractor due to the run-off of high-margin securitizations.



From Third Avenue Management (Trades, Portfolio)'s second quarter 2014 shareholder letter.

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Gabelli Asset Management Comments on The Bank of New York Mellon - May 13, 2014

The Bank of New York Mellon Corp. (1.0%) (BK)(BK - $35.29 - NYSE) is a global leader in providing financial services to institutions and individuals. The company operates in over one hundred markets worldwide and strives to be the global provider of choice for investment management and investment services. As of December 31, 2013, the firm had $27.6 trillion in assets under custody and $1.6 trillion in assets under management. Going forward, we expect BNY Mellon to benefit from rising global incomes and the cross border movement of financial transactions.

From Mario Gabelli (Trades, Portfolio)'s Value 25 Fund first quarter 2014 shareholder commentary.

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Lountzis Asset Management Comments on Bank of New York Mellon - Mar 21, 2014

BANK OF NEW YORK MELLON (NYSE:BK) is a leading trust bank with assets under custody and management exceeding $27 trillion. They are a global leader in several segments in which it operates. Few competitors have their global reach and scale. Approximately 80% of its revenues are reoccurring and fee-based focused on institutional services with less reliance on the higher credit risk from lending.



In 2013, BK generated operating revenue of $14.9 billion and pre-tax income of $3.7 billion. The bank’s results were helped by their continued efficiency initiatives which generated over $650 million in annual savings. Low interest rates continue to negatively impact results as they have over the past few years. The bank continues to work diligently on its initiatives to cut expenses and selectively raise prices on many of its products. We believe the bank can earn $2.45 in 2014 representing a multiple of just over 13x earnings, while paying a 3% dividend yield.



From Lountzis Asset Management 2013 Annual Letter



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Mario Gabelli Comments on Bank of New York Mellon - Feb 19, 2014

The Bank of New York Mellon Corp. (0.5% of net assets as of December 31, 2013) (BK)($34.94 - NYSE) is a global leader in providing financial services to institutions and individuals. The company operates in over one hundred markets worldwide and strives to be the global provider of choice for investment management and investment services. As of September 30, 2013, the firm had $27.4 trillion in assets under custody and $1.5 trillion of assets under management. Going forward, we expect BNY Mellon to benefit from rising global incomes and the cross border movement of financial transactions.



From the Gabelli Value 25 Fund fourth quarter 2013 commentary.



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Chris Davis Comments on Bank of New York Mellon - Oct 03, 2013

Our largest position is Bank of New York Mellon (BK). Starting with the business, despite having the word “bank” in its name, Bank of New York Mellon is not a bank in the traditional sense but instead primarily provides a range of processing, custody and investment management services to corporations, governments and financial institutions. While absolutely essential, these services are not easily understood by the layman. To use an analogy, if the financial markets are like a thriving city, then Bank of New York Mellon would be the local electric utility, a necessary but unglamorous element of the city’s infrastructure. The two largest segments (comprising approximately 55% of total company earnings) are asset custody (where it holds $26 trillion in assets on behalf of customers) and issuer services (where it acts as trustee for approximately $11 trillion of debt securities and more than 1,300 depository receipt programs). To put these numbers in perspective, the market capitalization of the entire S&P 500® Index is about $15 trillion and the total government debt outstanding (federal, state and local) in the United States is about $20 trillion. Each of these businesses is an oligopoly in which Bank of New York has a leading position with durable competitive advantages derived from economies of scale, the costs of switching and customer loyalty.

In addition to the base fee income earned in its investment services business, the bank generates ancillary revenue from foreign exchange trading, securities lending and the interest rate spread on approximately $220 billion of low cost deposits on which the bank currently pays an average interest rate of less than 0.1%. The “moat” around the investment services businesses is evidenced by the high returns on tangible equity that Bank of New York earns—currently in the mid-20’s and historically in the mid-30’s.

Bank of New York also has a more traditional investment management business that represents approximately 30% of total company’s earnings. This business is made up of a diverse collection of equity, fixed income, alternative asset, and money market management services with an aggregate of $1.4 trillion of assets under management. The investment management business also offers an inherently high return on capital, though the moats surrounding it tend to be lower than for the investment services business. Bank of New York’s diversity of asset classes offers some protection from the ebbs and flows of investor sentiment.

In general, each of the bank’s major businesses should grow in conjunction with the continued increase in the amount and value of debt and equity outstanding globally, with only modest incremental capital needed to support that growth.

In terms of people, CEO Gerald Hassell has held that position since 2011, and prior to that had been president since 1998. Since assuming the role of CEO, he has focused the company on improving operational efficiencies and on the disciplined allocation of capital. Having built up its regulatory capital levels over the last few years to comply with Basel 3 rules (voluntary global regulatory standards developed in response to the global financial crisis of the late 2000’s), Bank of New York is today allocating approximately 70% of earnings to share repurchases and dividends (after already returning some $3 billion to shareholders in the last two years), with the balance retained to support largely organic growth at high incremental rates of return. Given the utility nature of this business, the bank does not need a visionary leader but rather a disciplined one, a description that seems to fit Mr. Hassell. Past leaders have pursued expensive acquisitions and poorly thought-out strategic expansions. Current management seems to understand this well and has wisely set their attention on execution and cost discipline.

As for price, Bank of New York Mellon is valued today at about 13 times this year’s earnings or nearly a 7.5% earning yield. As mentioned above, the majority of these earnings are distributable to shareholders as the company is extremely well capitalized (or will be by the end of this year, depending on some clarification of regulatory standards) and can grow with relatively small amounts of retained capital. Further, we consider these earnings somewhat understated because today’s low interest rates have forced the bank to waive money market fees and have depressed interest margins. We estimate an increase of 100 basis points in interest rates could increase earnings by about 15% and reduce the valuation multiple to only 11 times earnings.

Finally, we must consider the risks. When presenting the rationale for an investment, it is common to hear all the reasons the investment will be successful. As a central part of our investment process, we want to examine all the reasons an investment could fail. With acknowledgement to the wonderful behavioral economist Daniel Kahneman, we refer to this exercise as a “pre-mortem.” For any company, the most dire risks might be called “existential risks.” These are the risks of some event or series of events entirely wiping out existing stockholder value. In recent years, existential risks have tended to be caused by either leverage or obsolescence (usually resulting from technological innovation). Although Bank of New York Mellon is certainly leveraged in that assets significantly exceed equity, these assets are predominately government securities and deposits rather than loans or securities subject to credit risk. In fact, in the draconian stress test laid out by regulators, which assumes a 5% decline in GDP over two years, an unemployment rate of 12%, a stock market decline of 50%, and residential and commercial real estate declines of 20%, Bank of New York Mellon would actually make more than $5 billion before taxes. As for technological obsolescence, the very fact the bank is well into its third century of existence would seem to indicate a relative low risk of obsolescence, which is true. As with an electric utility, the services provided by the bank are essential and irreplaceable.

Although such existential risk is low at Bank of New York Mellon, there are other important risks that could hurt our investment. The largest of these may well be a matter of national security. Although the bank maintains outstanding computer systems and other safeguards, a significant disruption, most likely in the form of a cyber-attack, of the bank’s computer operations could result in substantial losses given the sheer number of transactions processed every hour. At a less esoteric level, the bank is regulated as one of the world’s most significant financial institutions. As such, missteps with the regulators or inappropriate conduct toward customers (as happened several years ago when the bank was accused of pricing foreign exchange trades in a misleading manner) could result in significant fines, legal liability or higher capital requirements. Although the bank operates in an oligopoly in most of its businesses, another risk is that participants in an oligopoly do not always behave rationally. Certainly, in recent years a tendency toward undisciplined pricing has permeated this industry, though we hope this trend is diminishing. Finally, we must consider the possibility of the bank making a large, dilutive acquisition. Despite overwhelming data indicating that such acquisitions rarely create value, we are continually surprised by how often companies are tempted by the siren song of investment bankers. Fortunately, we consider this risk a remote one under current management.

From Chris Davis' David Funds fall 2013 manager commentary.

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Mason Hawkins Comments on Bank of New York Mellon
Bank of New York Mellon (BK) gained 4% in the quarter and 12% YTD. Expense controls helped results, although low market volatility and low rates this year have hampered revenue growth in asset services. The asset management business grew steadily along with the markets. The company emphasized the substantial earnings power that modest interest rate increases will create as money market fee waivers will end and net interest margins will expand. During the quarter BK repurchased almost 1% of outstanding shares, approximately one-third of the total buyback approved by the Federal Reserve. Read more...
Chris Davis Comments on Bank of New York Mellon
Bank of New York Mellon (BK) is a third example of the type of financial services businesses that Davis Advisors finds attractive. This company is a behind-the-scenes giant in the mundane yet durable businesses of trust services, asset custody, transaction processing, and asset management. While less widely understood than its traditional banking peers, Bank of New York Mellon is at the forefront of its industry in size and depth, operating in 35 countries with a leading $27.9 trillion under custody and/or administration. Although not in a glamorous industry, we believe its business lines are profitable, scalable, less risky, and less capital intensive than traditional banking with good long-term growth potential worldwide. Read more...

Ratios

vs
industry
vs
history
P/E(ttm) 16.30
BK's P/E(ttm) is ranked lower than
63% of the 1019 Companies
in the Global Asset Management industry.

( Industry Median: 12.50 vs. BK: 16.30 )
Ranked among companies with meaningful P/E(ttm) only.
BK' s 10-Year P/E(ttm) Range
Min: 8.11  Med: 15.94 Max: 42.45
Current: 16.3
8.11
42.45
Forward P/E 12.72
BK's Forward P/E is ranked lower than
52% of the 210 Companies
in the Global Asset Management industry.

( Industry Median: 12.80 vs. BK: 12.72 )
Ranked among companies with meaningful Forward P/E only.
N/A
PE(NRI) 16.20
BK's PE(NRI) is ranked lower than
62% of the 1015 Companies
in the Global Asset Management industry.

( Industry Median: 12.70 vs. BK: 16.20 )
Ranked among companies with meaningful PE(NRI) only.
BK' s 10-Year PE(NRI) Range
Min: 8.01  Med: 17.55 Max: 36.95
Current: 16.2
8.01
36.95
P/B 1.28
BK's P/B is ranked lower than
75% of the 1355 Companies
in the Global Asset Management industry.

( Industry Median: 0.92 vs. BK: 1.28 )
Ranked among companies with meaningful P/B only.
BK' s 10-Year P/B Range
Min: 0.64  Med: 1.22 Max: 4.44
Current: 1.28
0.64
4.44
P/S 2.88
BK's P/S is ranked higher than
77% of the 1251 Companies
in the Global Asset Management industry.

( Industry Median: 7.00 vs. BK: 2.88 )
Ranked among companies with meaningful P/S only.
BK' s 10-Year P/S Range
Min: 1.46  Med: 2.91 Max: 4.82
Current: 2.88
1.46
4.82
PFCF 11.43
BK's PFCF is ranked higher than
59% of the 255 Companies
in the Global Asset Management industry.

( Industry Median: 13.59 vs. BK: 11.43 )
Ranked among companies with meaningful PFCF only.
BK' s 10-Year PFCF Range
Min: 3.85  Med: 12.00 Max: 117.5
Current: 11.43
3.85
117.5
POCF 9.74
BK's POCF is ranked higher than
64% of the 722 Companies
in the Global Asset Management industry.

( Industry Median: 15.06 vs. BK: 9.74 )
Ranked among companies with meaningful POCF only.
BK' s 10-Year POCF Range
Min: 3.69  Med: 11.00 Max: 129.62
Current: 9.74
3.69
129.62
EV-to-EBIT -14.75
BK's EV-to-EBIT is ranked lower than
193% of the 969 Companies
in the Global Asset Management industry.

( Industry Median: 13.33 vs. BK: -14.75 )
Ranked among companies with meaningful EV-to-EBIT only.
BK' s 10-Year EV-to-EBIT Range
Min: -26.8  Med: -8.50 Max: 20.3
Current: -14.75
-26.8
20.3
Shiller P/E 24.10
BK's Shiller P/E is ranked lower than
73% of the 651 Companies
in the Global Asset Management industry.

( Industry Median: 12.29 vs. BK: 24.10 )
Ranked among companies with meaningful Shiller P/E only.
BK' s 10-Year Shiller P/E Range
Min: 8  Med: 16.91 Max: 27.96
Current: 24.1
8
27.96
Days Sales Outstanding 13.06
BK's Days Sales Outstanding is ranked higher than
70% of the 960 Companies
in the Global Asset Management industry.

( Industry Median: 37.48 vs. BK: 13.06 )
Ranked among companies with meaningful Days Sales Outstanding only.
BK' s 10-Year Days Sales Outstanding Range
Min: 13.36  Med: 20.86 Max: 181.29
Current: 13.06
13.36
181.29

Dividend & Buy Back

vs
industry
vs
history
Dividend Yield 1.67
BK's Dividend Yield is ranked lower than
84% of the 1500 Companies
in the Global Asset Management industry.

( Industry Median: 3.98 vs. BK: 1.67 )
Ranked among companies with meaningful Dividend Yield only.
BK' s 10-Year Dividend Yield Range
Min: 1.11  Med: 2.13 Max: 5.26
Current: 1.67
1.11
5.26
Dividend Payout 0.27
BK's Dividend Payout is ranked higher than
97% of the 904 Companies
in the Global Asset Management industry.

( Industry Median: 0.52 vs. BK: 0.27 )
Ranked among companies with meaningful Dividend Payout only.
BK' s 10-Year Dividend Payout Range
Min: 0.09  Med: 0.36 Max: 10
Current: 0.27
0.09
10
Dividend growth (3y) 11.20
BK's Dividend growth (3y) is ranked higher than
67% of the 530 Companies
in the Global Asset Management industry.

( Industry Median: 4.00 vs. BK: 11.20 )
Ranked among companies with meaningful Dividend growth (3y) only.
BK' s 10-Year Dividend growth (3y) Range
Min: -26.9  Med: 5.20 Max: 17.2
Current: 11.2
-26.9
17.2
Yield on cost (5-Year) 2.49
BK's Yield on cost (5-Year) is ranked lower than
73% of the 1500 Companies
in the Global Asset Management industry.

( Industry Median: 4.60 vs. BK: 2.49 )
Ranked among companies with meaningful Yield on cost (5-Year) only.
BK' s 10-Year Yield on cost (5-Year) Range
Min: 1.65  Med: 3.17 Max: 7.84
Current: 2.49
1.65
7.84
Share Buyback Rate 2.40
BK's Share Buyback Rate is ranked higher than
81% of the 839 Companies
in the Global Asset Management industry.

( Industry Median: -0.90 vs. BK: 2.40 )
Ranked among companies with meaningful Share Buyback Rate only.
BK' s 10-Year Share Buyback Rate Range
Min: 3.1  Med: -0.30 Max: -15.5
Current: 2.4

Valuation & Return

vs
industry
vs
history
Price/Tangible Book 3.29
BK's Price/Tangible Book is ranked lower than
87% of the 1303 Companies
in the Global Asset Management industry.

( Industry Median: 0.93 vs. BK: 3.29 )
Ranked among companies with meaningful Price/Tangible Book only.
BK' s 10-Year Price/Tangible Book Range
Min: 1.84  Med: 4.58 Max: 11.2
Current: 3.29
1.84
11.2
Price/Projected FCF 0.86
BK's Price/Projected FCF is ranked higher than
64% of the 406 Companies
in the Global Asset Management industry.

( Industry Median: 1.06 vs. BK: 0.86 )
Ranked among companies with meaningful Price/Projected FCF only.
BK' s 10-Year Price/Projected FCF Range
Min: 0.43  Med: 0.88 Max: 10.99
Current: 0.86
0.43
10.99
Price/Median PS Value 0.98
BK's Price/Median PS Value is ranked higher than
54% of the 1090 Companies
in the Global Asset Management industry.

( Industry Median: 1.00 vs. BK: 0.98 )
Ranked among companies with meaningful Price/Median PS Value only.
BK' s 10-Year Price/Median PS Value Range
Min: 0.53  Med: 1.36 Max: 5.93
Current: 0.98
0.53
5.93
Price/Peter Lynch Fair Value 1.92
BK's Price/Peter Lynch Fair Value is ranked lower than
86% of the 162 Companies
in the Global Asset Management industry.

( Industry Median: 0.69 vs. BK: 1.92 )
Ranked among companies with meaningful Price/Peter Lynch Fair Value only.
BK' s 10-Year Price/Peter Lynch Fair Value Range
Min: 1.09  Med: 1.73 Max: 4.3
Current: 1.92
1.09
4.3
Price/Graham Number 1.34
BK's Price/Graham Number is ranked lower than
75% of the 881 Companies
in the Global Asset Management industry.

( Industry Median: 0.71 vs. BK: 1.34 )
Ranked among companies with meaningful Price/Graham Number only.
BK' s 10-Year Price/Graham Number Range
Min: 0.89  Med: 1.93 Max: 3.55
Current: 1.34
0.89
3.55
Earnings Yield (Greenblatt) (%) -6.80
BK's Earnings Yield (Greenblatt) (%) is ranked lower than
83% of the 1366 Companies
in the Global Asset Management industry.

( Industry Median: 4.70 vs. BK: -6.80 )
Ranked among companies with meaningful Earnings Yield (Greenblatt) (%) only.
BK' s 10-Year Earnings Yield (Greenblatt) (%) Range
Min: 4.9  Med: 10.00 Max: 28.5
Current: -6.8
4.9
28.5
Forward Rate of Return (Yacktman) (%) 13.19
BK's Forward Rate of Return (Yacktman) (%) is ranked higher than
61% of the 446 Companies
in the Global Asset Management industry.

( Industry Median: 6.82 vs. BK: 13.19 )
Ranked among companies with meaningful Forward Rate of Return (Yacktman) (%) only.
BK' s 10-Year Forward Rate of Return (Yacktman) (%) Range
Min: 1.6  Med: 11.30 Max: 23.2
Current: 13.19
1.6
23.2

Analyst Estimate

Dec15 Dec16 Dec17
Revenue(Mil) 15,683 16,721 17,759
EPS($) 2.82 3.21 3.77
EPS without NRI($) 2.82 3.21 3.77

Business Description

Industry: Asset Management » Asset Management
Compare:AMP, AMG, BEN, BLK, TTS » details
Traded in other countries:BK.Argentina, BKNML.USA, BN9.Germany,
Bank of New York Mellon Corporation was formed as a bank holding company The Company is in business since 1784. It is a global investments company. businesses into two principal segments, Investment Management and Investment Services. The Company has an other segment, which includes credit-related services, the leasing portfolio, corporate treasury activities, its equity investment in Wing Hang Bank Limited, its equity interest in ConvergEx Group, business exits and corporate overhead. Its two principal banks are: The Bank of New York Mellon, a New York state chartered bank, which houses its Investment Services businesses, including Asset Servicing, Issuer Services, Treasury Services, Broker-Dealer and Advisor Services as well as the bank-advised business of Asset Management. BNY Mellon, National Association (BNY Mellon, N.A.), a nationally-chartered bank, which houses its Wealth Management business. The Company's two principal U.S. banks engage in trust and custody activities, investment management services, banking services and various securities-related activities. They have four other U.S. bank and/or trust companies concentrating on trust products and services across the United States: The Bank of New York Mellon Trust Company, National Association, BNY Mellon Trust of Delaware, BNY Mellon Investment Servicing Trust Company and BNY Mellon Trust Company of Illinois. Its asset management businesses, along with its Pershing businesses, are direct or indirect non-bank subsidiaries of BNY Mellon. The Company's Investment Management business competes with asset management firms, hedge funds, investment banking companies and other financial services companies, including trust banks, brokerage firms, and insurance companies. Its Investment Services business competes with domestic and foreign financial services firms that offer custody services, corporate trust services, clearing services, collateral services, credit services. The Company's branches and subsidiaries outside the United States are subject to regulation by non-U.S. regulatory authorities in addition to the Board of Governors of the Federal Reserve System.
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