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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
State Street Corporation (XNYS:STT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
STT
Name:
STATE STREET CORPORATION (XNYS:STT)
Sector:
4.59B
Industry:
Asset Management
CEO:
Mr. Ronald O'Hanley
Total Employees:
40,354
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -174.55% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF STATE STREET CORPORATION(STT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ASSET MANAGEMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
67.68
One Month Price Target:
$68.29
Six Month Price Target :
$71.33
Likely Price in One Year's Time:
Ticker:
$74.97
Likely Trading Range Today Under (Normal Volatility)
$67.37
Price Upper limit ($) :
$68.02
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$63.77
This week:
$58.93
This month :
$50.17
Other Primary facts
Market Cap:
25.02B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
367.62M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
22.32%
-18.93%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$85.85
$77.56
$49.51
$57.80
Medium risk (<10%) entry points
Buy Call
Sell Call
$74.87
Buy Put:
Sell Put:
$73.10
$60.47
$62.26
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
STT
Sharpe Ratio:
0.35%
Comparison:
STT, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -55.96% lower than the industry
& is -84.46% lower than the market/S&P 500 average
Average Returns/Yield of
STT
Daily returns:
0.02%
Weekly returns:
0.09%
Monthly returns:
0.38%
Yearly returns:
9.18%
Comparison of returns:
Average annual returns/yield (last 3 years) is -50.72% below industry average
Classification:
STT, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.38
Statistical test of Returns:
STT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.83%
Weekly Volatility:
6.32%
Monthly Volatility:
12.64%
Yearly Volatility:
43.77%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.95%
Volatility in last five trading days has been -66.39% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.78%
Weekly VaR:
-12.93%
Monthly VaR:
-25.87%
How Much Can the price of
STT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-23%
Worst case (decline):
-89.60%
This translates to price declining to:
$52.34
This translates to price declining to:
$7.04
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
STT is a 82.56% riskier investment compared to the market/S&P 500 & is 56.40% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 8.73% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
STT
Beta in relation to market/S&P 500--1.60
Expected beta in 1 year's time:
1.007
Expected beta in 3 year's time:
1.424
Unlevered (debt free) Beta:
1.108
Beta in relation to Nasdaq (XNAS):
0.941
Beta in relation to all global stocks::
0.969
Beta Comparison & Analysis
Beta of competitors/peers::
1.072
Beta is 49.56% higher than peers
Average Industry Beta:
1.694
Beta is -5.38% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
-0.096
Alpha is 72.39% above industry average alpha yield
Alpha is -612% below the market average
Analysis of Cost of Capital of
STT
Equity cost of capital:
0.141
Equity cost of capital is -4.23% below industry mean WACC
Unlevered (without debt) cost of capital:
9.77%
Before-tax cost of debt:
0.08%
After-tax cost of debt:
0.06%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.06%
WACC is 83.51% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$30.88
Revenue growth rate per share of (3Y):
0.95
Annual revenue growth rate is -98.58% below industry average
EPS:
$7.38
Expected Annual growth rate of EPS (3Y):
7.36%
Expected future EPS growth rate is -73.49% lower than the Asset Management industry
Free cash flow (FCF) per share:
$2.54
Balance sheet equity growth per share: 6.36%
Equity growth rate per share is -69.92% lower than the industry
Debt per share
$37.87
EBITDA per share
$12.27
Valuation Analysis Today of
STT
P/E Ratio:
9.37
P/E Ratio of Competitors/Peers:
11.54
P/E ratio is -18.84% lower than main peers & is -41.99% lower than the industry
Stock price/value with industry average P/E ratio: $119.17
STT is -43.21% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $27.21
Present value of the expected future dividends only: $17.48
P/S (Price to Sales ratio):
2.19
Price to sales ratio is -68.01% below the industry mean
P/B (Price to book value ratio):
0.95
Price to free cash flow: 26.59
-
Net income growth rate (3Y):
5.37%
Net income growth rate is -96.31% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 8.24%
Dividend yeild: 3.37%
Previous Dividend: $0.57
Previous adjusted dividend: $0.57
Previous Dividend: $2.28
Expected next dividend best case: $0.59
Expected next dividend worst case: $0.55
Average dividend payment (long-term): $0.54
Average dividend increase/decrease (growth rate) % per period: 0.96%
Expected next dividend payment date: 10/10/2022
Expected next dividend record date: 29/09/2022
Expected next dividend declaration date: 16/08/2022
Previous dividend payment date: 07/11/2022
Previous dividend record date: 07/01/2022
Previous dividend declaration date: 18/05/2022
Dividend History:
2022-06-30--$0.57
2021-12-31--$0.57
2021-06-30--$0.52
2022-03-31--$0.57
2021-09-30--$0.57
2021-03-31--$0.52
Dividend growth rate is -82.61% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
53.09%
Net debt to equity ratio:
-354.81%
Debt to assets ratio:
4.32%
Net debt to assets ratio:
-28.86%
Debt-to-asset ratio is -91.74% below industry average
Ability to repay debt:
Interest coverage ratio:
410
Interest coverage ratio is 589.44% more than industry average
Looking forward:
Debt growth rate:
-23.54%
Annual debt growth is 241% higher than industry average debt growth rate
Debt repayment rate in last quarter: 5.21%
Analysis of Key Statistics
Correlation of price movement with the market:
0.733
Statistical significance of correlation:
STT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.576
Stock price is 27.28% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.576
Correlation of price movement with Nasdaq (^IXIC):
0.017
Covariance of price movement with the market:
0.028
Kurtosis
10.128
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.239
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
STT
Gross Profit Margin Ratio:
100%
Operating Profit Margin Ratio:
23.36%
Operating profit margin is -50.33% lower than the industry
Net Profit Margin Ratio:
100%
Effective Tax Rate:
15.77%
Effective tax rate is -35.44% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.59%
Return on equity (ROE) is -58.10% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
0.86%
Return on assets (ROA) is -85.23% lower than the industry
Financial Leverage:
1.0x
Current Ratio:
4593.89
Current ratio is 119652.34% above industry average
Cash Conversion Cycle (days):
109.3
Cash conversion cycle is -87.41% below industry average
The remaining useful life of property plant & equipment is: 2.9 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
281.3K
Each employee generates -80% less revenue than industry average revenue per employee
EBITDA generated per employee:
111.8K
Each employee generates -115% less EBITDA than industry average revenue per employee
Profit generated per employee:
68.8K
Each employee generates -106% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
113.6K
Each employee generates -195% less free cash flow than industry average revenue per employee
Assets/Capital per employee
3.3M
Each employee generates -195% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
STT
DISCOVER FINANCIAL SERVICES (XNYS:DFS)
NATWEST GROUP PLC (XNYS:NWG)
FIRST REPUBLIC BANK (XNYS:FRC)
AMERIPRISE FINANCIAL, INC. (XNYS:AMP)
Itau Unibanco Holding SA (XNYS:ITUB)
MANULIFE FINANCIAL CORP (XNYS:MFC)
Banco Bradesco SA (XNYS:BBD)
ARTHUR J. GALLAGHER & CO. (XNYS:AJG)
Pathward Financial, Inc. (XNAS:CASH)
Current Analyst Ratings
Strong buy�8%
Buy�21%
Hold�54%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
11.35B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
3.08B
-
4.56B
4.62B
56.00M
-
-
1.96B
11.00M
1.20B
4.51B
2.65B
2.78B
3.30B
520.00M
2.78B
Statement of Cash Flow
Date:
Period:
61.00M
Differed Income Tax :
7.00M
Stock Based Compensation :
-
Change in Working Capital :
82.80B
Accounts Receivables:
-
Other Working Capital:
82.67B
Other Non-Cash Items:
- 78886000.00K
Net Cash Provided by Operating Activities:
4.59B
Investments in PP&E:
-
Net Acquisitions:
- 3000.00K
Purchases of Investments:
2.14B
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
106.99B
74.35B
181.33B
3.45B
-
- 102090000.00K
82.69B
2.23B
7.58B
1.74B
120.31B
-
-
131.86B
371.52B
322.35B
-
18.00M
-
-
-
18.00M
13.92B
-
13.92B
310.03B
296.13B
504.00M
25.61B
- 2698000.0K
830.00M
March 31, 2022 at 6:00:00 AM
1.93B
26.22B
322.35B
194.65B
13.94B
- 93046000.0K
-
- 6471000.00K
- 4336000.00K
- 765000.00K
-
-
- 229000.00K
89.00M
- 905000.00K
-
- 655000.00K
2.98B
3.63B
4.59B
-
4.59B
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
STT
2023
2024
2025
2026
2027
$88.28
$97.79
$108.32
$119.99
$132.92