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Investing.com - Keefe, Bruyette & Woods raised its price target on State Street (NYSE:STT) to $135.00 from $132.00 on Monday, while maintaining an Outperform rating on the financial services company.
The price target increase follows what KBW described as a "strong revenue beat" from State Street , driven primarily by fees that exceeded expectations by $0.21. Foreign exchange trading contributed to more than half of this outperformance. This performance has helped drive State Street’s impressive 39% price gain over the past six months.
State Street posted 7% year-over-year growth in servicing revenues and achieved record management fees, according to KBW’s analysis. Net interest income missed expectations by $0.03 due to a smaller balance sheet resulting from a seasonal decline in deposits.
KBW expects increasing net interest income trends going forward, citing back book repricing and run-off of terminated swap amortization as contributing factors. Despite the revenue outperformance, the firm does not anticipate material changes to consensus estimates.
The investment bank considers State Street stock attractive at its current valuation, noting it trades below 10 times KBW’s 2026 earnings estimate with high-teens return on tangible common equity (ROTCE). InvestingPro analysis shows the stock currently trades at a P/E of 11.81x and has maintained dividend payments for 55 consecutive years, highlighting its long-term stability. Discover more insights about State Street’s valuation metrics and 8 additional ProTips with an InvestingPro subscription.
In other recent news, State Street Corporation reported its third-quarter 2025 earnings, surpassing Wall Street expectations. The company achieved an earnings per share (EPS) of $2.78, outpacing the forecasted $2.63. Revenue also exceeded projections, reaching $3.55 billion compared to the anticipated $3.46 billion. Despite these positive financial results, the company’s stock saw a pre-market decline. Analysts from various firms have been closely monitoring these developments. These recent updates reflect the ongoing performance and financial health of State Street Corporation. Investors and stakeholders are advised to consider these earnings and revenue outcomes in their assessments.
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