State Street stock rating upgraded by CFRA to Buy on growth outlook

Investing.com - CFRA has upgraded State Street (NYSE:STT) from Hold to Buy while raising its price target to $124.00 from $105.00, citing confidence in the company’s growth potential across all business segments. The stock, currently trading at $102.65, appears undervalued according to InvestingPro analysis, with the shares trading near their 52-week high of $110.97.

The upgrade follows State Street’s Q2 2025 performance, which showed adjusted earnings per share of $2.53, supported by strong fee revenue despite higher expenses and a slight decline in net interest income to $735 million. The company has demonstrated robust momentum, delivering a 43.93% return over the past year and a 14.77% gain year-to-date. InvestingPro subscribers have access to 10+ additional exclusive insights about State Street’s performance and outlook.

CFRA highlighted the 80 basis point improvement in State Street’s pre-tax margins in Q2 2025 compared to Q1 2025, noting further opportunities for margin expansion throughout 2025.

The research firm raised its earnings estimates for State Street to $9.75 per share for 2025 and $10.80 for 2026, projecting total revenue of $13.7 billion in 2025 and $14.4 billion in 2026.

CFRA also pointed to State Street’s financial stability, confirmed by the Federal Reserve’s June stress tests, while noting that the stock currently trades at a 48% discount to the S&P 500’s P/E multiple of 22.0x.

In other recent news, State Street Corporation announced its intention to increase its quarterly common stock dividend by 11% to $0.84 in the third quarter of 2025, pending board approval. This follows the company’s successful completion of the Federal Reserve’s 2025 Supervisory Stress Test, with its Stress Capital Buffer calculated below the 2.5% minimum. In a strategic move, State Street and UC Investments have launched a digital investing platform to provide individual investors access to institutional-grade tools, initially targeting participants in UC’s defined contribution plan. Meanwhile, CFRA downgraded State Street’s stock rating from "Buy" to "Hold" and adjusted the price target to $105, citing a limited upside after a recent share price increase. Conversely, Truist Securities upgraded State Street to "Buy" with a raised price target of $112, highlighting the company’s advantageous position in the equity market and its significant foreign exchange revenue. Additionally, State Street appointed Sara Mathew as the new independent Lead Director of its Board, succeeding Dame Amelia Fawcett. Mathew’s extensive experience and previous roles within the company are expected to enhance shareholder and regulatory engagement. These developments reflect State Street’s ongoing strategic initiatives and leadership changes.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.