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1. Company Snapshot

1.a. Company Description

State Street Corporation, through its subsidiaries, provides a range of financial products and services to institutional investors worldwide.The company offers investment servicing products and services, including custody; product accounting; daily pricing and administration; master trust and master custody; depotbank services; record-keeping; cash management; foreign exchange, brokerage and other trading services; securities finance and enhanced custody products; deposit and short-term investment facilities; loans and lease financing; investment manager and alternative investment manager operations outsourcing; performance, risk, and compliance analytics; and financial data management to support institutional investors.It also engages in the provision of portfolio management and risk analytics, as well as trading and post-trade settlement services with integrated compliance and managed data.


In addition, the company offers investment management strategies and products, such as core and enhanced indexing, multi-asset strategies, active quantitative and fundamental active capabilities, and alternative investment strategies.Further, it provides services and solutions, including environmental, social, and governance investing; defined benefit and defined contribution; and global fiduciary solutions, as well as exchange-traded fund under the SPDR ETF brand.The company provides its products and services to mutual funds, collective investment funds and other investment pools, corporate and public retirement plans, insurance companies, foundations, endowments, and investment managers.


State Street Corporation was founded in 1792 and is headquartered in Boston, Massachusetts.

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1.b. Last Insights on STT

State Street Corporation's recent performance was driven by strong Q4 2025 earnings, with a 14% year-over-year EPS growth and record revenue. Elevated global markets boosted fee income, driving positive operating leverage and profitability. The company's strategic growth initiatives and cost efficiencies also contributed to its performance. Additionally, State Street's re-rating to over 2.3 times tangible book value, around 30% above its recent historical average, reflects its strong financials. A conference call to discuss the firm's financial results and outlook was held, providing further insights into its growth prospects.

1.c. Company Highlights

2. State Street's Strong 2025 Earnings: A Promising Outlook

State Street Corporation reported a robust fourth quarter and full-year 2025 earnings, with EPS growth of 14% year over year, reaching $2.97, exceeding analyst estimates of $2.79. The company's full-year EPS stood at $10.3, up 19% year over year, driven by strong revenue growth and expanding margins. Total revenue reached a record quarterly level, with fee revenue and total revenue both achieving new highs. The return on tangible common equity was 20%, excluding notable items, highlighting the company's operational efficiency.

Publication Date: Jan -18

📋 Highlights
  • Record Revenue & EPS Growth:: Q4 2025 revenue and fee income hit records, with EPS up 14% YoY to $2.58 (Q4 2024: $2.26), and full-year EPS rose 19% to $10.30.
  • Strategic Milestones:: Surpassed $50 trillion in AUCA (prior: $45T), launched digital asset platform, and private markets servicing fees grew double-digits YoY.
  • Investment Management Strength:: Management fee revenue reached $662M (Q4 2025), up 15% YoY, with assets under management hitting $5.7T (+20% YoY).
  • Capital Returns:: Returned $2.1B to shareholders in 2025 (buybacks: $1.4B, dividends: $700M), maintaining an 80% total payout ratio.
  • 2026 Outlook:: Targets 4–6% fee revenue growth, low single-digit NII increase, and $500M productivity savings, with CET1 ratio at 11.7% (up 40 bps YoY).

Revenue Growth Drivers

The company's investment management business had a record year, with management fee revenue up 15% year over year to $662 million. Assets under management increased 20% from the prior year to an all-time high of $5.7 trillion. State Street's markets franchise also performed well, generating double-digit full-year fee revenue growth across FX trading services and securities finance. Private markets servicing fees grew at a double-digit year-over-year pace, further contributing to the company's revenue growth.

Expense Management and Capital Position

Expenses increased 5% for the full year, primarily driven by strategic initiatives and technology investments. However, the company achieved $500 million in productivity savings, meeting its target. State Street's capital position remains strong, with a standardized CET1 ratio of 11.7% at quarter-end. The company returned over $2.1 billion to shareholders in 2025 through common share repurchases and dividends, demonstrating its commitment to shareholder value.

2026 Outlook and Valuation

State Street's 2026 outlook assumes global equity markets to be flat, with fee revenue expected to grow 4% to 6%. Net interest income is expected to increase by low single digits, with an improvement in net interest margin. The company's guidance reflects a balance between risk-based and leverage metrics. With a P/E Ratio of 12.17 and a P/TBV that can be derived from the given 'P/B Ratio': 1.31, which indicates a reasonable valuation. The Dividend Yield stands at 2.5%, making it an attractive income stream. Analysts estimate next year's revenue growth at 4.3%, aligning with the company's guidance.

Digital Transformation and Growth Opportunities

State Street is progressing with its digital transformation, focusing on enabling the transition to digital finance. The company is well-positioned to capitalize on growth opportunities in digital assets, including tokenized money market funds. While the financial impact is not expected to be visible in 2026, it represents a medium-term opportunity. The company's software business is transitioning from on-prem to SaaS, with growth expected to resume once the transition is complete.

3. NewsRoom

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State Street Corporation (STT) Presents at Bank of America Financial Services Conference 2026 Transcript

05:34

Source: seekingalpha.com

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Bessemer Group Inc. Has $1.85 Million Holdings in State Street Corporation $STT

Feb -09

Source: defenseworld.net

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Allianz Asset Management GmbH Sells 209,282 Shares of State Street Corporation $STT

Feb -06

Source: defenseworld.net

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State Street Corporation $STT Stock Position Lifted by Jones Financial Companies Lllp

Feb -04

Source: defenseworld.net

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Top 10 High-Yield Dividend Stocks For February 2026

Feb -03

Source: seekingalpha.com

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Truist Financial Corp Sells 19,656 Shares of State Street Corporation $STT

Feb -02

Source: defenseworld.net

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State Street Corporation $STT Shares Purchased by National Pension Service

Feb -02

Source: defenseworld.net

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The Fed Paused Rate Cuts. That's Great News for These 2 Financial Stocks

Feb -01

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.86%)

6. Segments

Investment Servicing

Expected Growth: 8.9%

State Street Corporation's 8.9% growth in Investment Servicing is driven by increasing demand for outsourced investment operations, growth in alternative assets, and expansion into new markets. Additionally, the company's investments in digital platforms and technology have improved operational efficiency, enabling it to onboard new clients and increase assets under management.

Investment Management

Expected Growth: 8.9%

State Street Corporation's 8.9% growth in Investment Management is driven by increasing demand for ETFs and index funds, expansion into alternative investments, and strategic acquisitions. Additionally, the company's strong brand reputation, diversified client base, and investments in digital transformation and operational efficiency have contributed to its growth momentum.

Other

Expected Growth: 7.03%

State Street Corporation's 7.03% growth in 'Other' segment is driven by increasing demand for its investment management services, growth in global exchange-traded funds (ETFs), and expansion of its outsourcing services to institutional investors. Additionally, the company's strategic acquisitions and partnerships have contributed to the segment's growth.

7. Detailed Products

Custody and Accounting

State Street's custody and accounting services provide clients with a comprehensive solution for managing their investment portfolios, including trade execution, settlement, and asset servicing.

Fund Administration

State Street's fund administration services provide investment managers with a range of services, including fund accounting, financial reporting, and compliance support.

Transfer Agency

State Street's transfer agency services provide investors with a range of services, including account maintenance, transaction processing, and customer support.

Alternative Investment Solutions

State Street's alternative investment solutions provide investors with a range of services, including fund administration, accounting, and reporting for alternative assets such as private equity and real estate.

Foreign Exchange

State Street's foreign exchange services provide clients with a range of solutions for managing foreign exchange risk, including spot and forward transactions, options, and hedging strategies.

Securities Lending

State Street's securities lending services provide investors with a range of solutions for generating revenue from their portfolios, including securities lending, borrowing, and collateral management.

Data and Analytics

State Street's data and analytics services provide clients with a range of solutions for managing and analyzing their investment data, including portfolio analytics, risk management, and performance measurement.

8. State Street Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

State Street Corporation's threat of substitutes is moderate due to the presence of alternative financial institutions and investment firms that offer similar services.

Bargaining Power Of Customers

State Street Corporation's customers have significant bargaining power due to their large size and ability to negotiate prices and services.

Bargaining Power Of Suppliers

State Street Corporation has a diverse supplier base, which reduces the bargaining power of individual suppliers.

Threat Of New Entrants

The threat of new entrants in the financial services industry is low due to the high barriers to entry, including regulatory requirements and capital requirements.

Intensity Of Rivalry

The intensity of rivalry in the financial services industry is high due to the presence of many established players and the need to differentiate services and prices.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 47.46%
Debt Cost 11.57%
Equity Weight 52.54%
Equity Cost 11.57%
WACC 11.57%
Leverage 90.34%

11. Quality Control: State Street Corporation passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Federated Hermes

A-Score: 7.5/10

Value: 6.0

Growth: 6.6

Quality: 8.5

Yield: 6.0

Momentum: 8.0

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
State Street

A-Score: 6.6/10

Value: 6.7

Growth: 4.7

Quality: 5.6

Yield: 6.0

Momentum: 8.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
FS KKR Capital

A-Score: 6.3/10

Value: 6.2

Growth: 4.6

Quality: 5.8

Yield: 10.0

Momentum: 2.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
SEI Investments

A-Score: 6.0/10

Value: 3.9

Growth: 5.7

Quality: 9.2

Yield: 2.0

Momentum: 5.5

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
Prospect Capital

A-Score: 5.5/10

Value: 6.5

Growth: 3.9

Quality: 4.7

Yield: 10.0

Momentum: 0.5

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Cohen & Steers

A-Score: 5.4/10

Value: 4.2

Growth: 3.3

Quality: 8.8

Yield: 7.0

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

132.23$

Current Price

132.23$

Potential

-0.00%

Expected Cash-Flows