BNY’s Transformation ‘Continues to Deliver Strong Results,’ Analyst Says After Q3 Beat

Shares of Bank of New York Mellon Corp (NYSE:BNY) rose in early trading on Friday, after the company reported its third-quarter results.

The company’s results indicate that its transformation under the leadership of CEO Robin Vince "continues to deliver strong results," according to RBC Capital Markets.

The Bank of New York Mellon Chase Rating: Analyst Gerard Cassidy maintained a Sector Perform rating and price target of $168.

The Bank of New York Mellon Thesis: The company’s transformation has led to "breaking down business unit silos and a reduction in expense growth," Cassidy said in the note.

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The analyst highlighted the following from Bank of New York Mellon’s results:

• Total revenue grew 12% year-on-year to $5.68 billion.
• Revenue growth was driven by fee revenue up 12% year-on-year to $4.08 billion.
• Issuer Services delivered "standout" revenue growth of 43% year-on-year.
• Revenue growth outpaced expense growth of 8.0% year-on-year, producing 389 basis points of positive operating leverage.
• Expense growth was mostly revenue-related, with remaining costs reflecting technology investments.
• Pre-tax operating margin expanded to 38.5% from 36.4% a year ago.
• Earnings grew 24% year-on-year to $2.34 per share, supported by both operating performance and share buybacks.
• Earnings came in higher than the consensus of $2.27 per share.

Bank of New York Mellon "returned $1.37 billion to common shareholders in the quarter, $436.0 million in dividends and $937.0 million in share repurchases, bringing the year-to-date payout ratio to 86%," he further wrote.

The analyst raised the earnings estimates for both 2026 and 2027 from $9.00 per share to $9.35 per share and from $9.90 to $10.45, respectively.

"By being laser focused on its execution," Bank of New York Mellon is achieving "strong positive operating leverage (its Northstar), which should lead to enhanced EPS growth," Cassidy added.

BNY Stock Price Activity: Bank of New York Mellon shares are trading higher by 0.78% at $143.20 at the time of publication on Friday, according to Benzinga Pro data.