Northern Trust

Methodology

Northern Trust's wealth management and custody services generate relatively stable fee-based earnings, though market volatility and interest rate sensitivity create quarterly fluctuations. Asset levels and private client relationships provide revenue visibility. The calculation works reasonably well for this trust bank when focusing on through-cycle fee income and normalizing for rate impacts.

Methodology

Northern Trust typically trades at moderate PEG ratios reflecting slow-growth characteristics of wealth management offset by strong client relationships and operational efficiency. Banks are often better evaluated using price-to-tangible-book versus ROE. If using PEG, focus on fee income trends and normalized earnings through market and rate cycles.

Methodology

Northern Trust offers an attractive dividend with consistent growth supported by stable fee-based revenues. The dividend adds meaningful value to total returns for this conservative trust bank. For wealth management banks, dividend yield and fee income stability matter significantly alongside modest growth expectations.