The Stealth Reason Why The Bank of New York Mellon Corporation (BK) Is Hot

A handful of technical analysis tools are suggesting that The Bank of New York Mellon Corporation (NYSE:BK) overall gets 8% Buy rating. The stock is also flashing a Hold from the Barchart TrendSpotter trading system. Traders hoping to speculate on the BK’s short-term trajectory should know that short terms indicators for the stock averaged 40% Buy with an average daily trading volume over the past 20 days at 5566245 shares. BK stock has overall a 0.25% Buy signal considering medium term indicators and the 50-day average daily volume remained almost 5880228 shares. It’s also worth noting that the stock, whose average daily volume over the 100 days prior to this writing was 5537177 shares, is 67% Sell on the basis of long term indicators.

The share price is currently staying around the first support level of $49.37. Below this, the next support is placed in the zone of $48.89. Till the time, the BK stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 56.97 on daily chart, which may remain a cause for concern. If the price breaks below $48.89 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $50.29 mark may result into a pull-back move towards $50.73 level.

The Bank of New York Mellon Corporation (BK) is projected to climb by 10.15 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $66-month high price target. This represents a whopping 32.37 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $55, which represents a return potential of 10.31 percent when compared to the closing price of the stock of $49.86 on Friday, November 23. The lowest price target for the stock is $49 — slightly more than -1.72 percent from BK’s current share price.

Here’s a rundown of insider trading activity for sense of The Bank of New York Mellon Corporation (NYSE:BK). The earliest insider trade took place on 05/11/2018. Kurimsky Kurtis R. parted with a total of 4.7 thousand shares of company at average share price of $57.44. The total for the sales was set at $270.03 thousand. After this transaction, the Controller account balance stood at 16.49 thousand shares. The stock lost -13.2 percent since that insider sale. On 04/23/2018, Harris Mitchell E., Sr. Executive Vice President, sold 48 thousand shares at a price per share of $56. This removed 2.69 million shares from the insider’s fortune and the stock saw a -10.96 percent retreat in value since the news became public. This transaction left 150.6 thousand shares in the Sr. Executive Vice President account. On 04/23/2018, SEVP & General Counsel Mccarthy J Kevin performed a sale transaction worth $838.35 thousand. This sale at $55.89 each has eliminated 15 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -10.79 percent decrease since the transaction was reported. The insider now is left with 100.61 thousand shares remaining in the account. Trian Fund Management, L.P., who performs the Director job, bought 360 thousand shares for $20.4 million. The acquisition occurred on 03/09/2018 was priced at $56.67 per share. The share price plunged -12.02 percent since the reporting date. Trian Fund Management, L.P. now left with a stake of 16.13 million BK stock worth $804.11 million after the insider buying.

BK shares dropped -0.1 points or -0.2 percent on Friday to $49.86 with a light trade volume of 2.122 million shares. After opening the session at $49.6, the shares went as high as $50.24 and as low as $49.32, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $49.3 billion and now has 988.78 million shares outstanding. The Bank of New York Mellon Corporation (BK) stock has gained 9.99 percent of market value in 21 trading days.

Analysts at Keefe Bruyette cut their rating on shares of The Bank of New York Mellon Corporation (NYSE:BK) from Mkt Perform to Underperform in their opinion released on October 19. Raymond James analysts have downgraded their rating of BK stock from Outperform to Mkt Perform in a separate flash note to investors on July 12. Analysts at Goldman downgraded the stock to a Neutral call from its previous Buy stance, in a research note that dated back to March 12.

BK stock has a trailing 3-year beta of 1.03, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $3.5 a share in the trailing twelve months. The stock’s value has fallen -7.43 percent year to date (YTD) against a decline of -4.9 percent in 12 month’s time. The company’s shares still trade -15.48 percent away from its 1-year high of $58.99 and 10.41 percent up from 52-week low of $45.16. The average consensus rating on the company is 3, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a hold.

Shares of The Bank of New York Mellon Corporation (BK) are trading at a P/E ratio of 16.18 times earnings reported for the past 12 months. The industry BK operates in has an average P/E of 93.06. Its P/E ratio went as low as 12.68X and as high as 20.15 over the 5-year span. Further, it is sporting a 8.52 on the Price-to-Sales ratio. Compare this with the industry average P/S of 7.68. 0 percent is the gross profit margin for The Bank of New York Mellon Corporation and operating margin sits at 62.1 percent. Along with this, the net profit margin is 75.4 percent.

BK will be declaring its Q4 financial results on January 17. Analysts are forecasting revenue to climb 1.7 percent to $4.11B in the next fiscal quarter, while earnings are seen soaring by nearly 5.49 percent to $0.96 per share. History has shown that shares in The Bank of New York Mellon Corporation have gone down on 20 different earnings reaction days and are predicted to add 0.02 percent when the company reports upcoming earnings. In last reported earnings results, it earned $1.06 per share, better than the $1.04, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $4.07B, worse than the $4.15B analysts expected. Earnings are estimated to increase by -3.4 percent this year, 5.33 percent next year and continue to increase by 8.87 percent annually for the next 5 years.