Q3 Rundown: Northern Trust (NASDAQ:NTRS) Vs Other Custody Bank Stocks

As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the custody bank industry, including Northern Trust (NASDAQ:NTRS) and its peers.

Custody banks safeguard financial assets and provide services like settlement, accounting, and regulatory compliance for institutional investors. Growth opportunities stem from increasing global assets under custody, demand for data analytics, and blockchain technology adoption for settlement efficiency. Challenges include fee pressure from large clients, substantial technology investment requirements, and competition from both traditional players and fintech firms entering the space.

The 16 custody bank stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.2%.

While some custody bank stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.2% since the latest earnings results.

Northern Trust (NASDAQ:NTRS)

Founded in 1889 during Chicago's post-Great Fire rebuilding boom, Northern Trust (NASDAQ:NTRS) provides wealth management, asset servicing, and banking solutions to corporations, institutions, families, and high-net-worth individuals globally.

Northern Trust reported revenues of $2.03 billion, up 2.9% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with an impressive beat of analysts’ AUM estimates but a slight miss of analysts’ advisory and servicing fees estimates.

Unsurprisingly, the stock is down 4.5% since reporting and currently trades at $122.79.

Is now the time to buy Northern Trust? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Hamilton Lane (NASDAQ:HLNE)

With over $100 billion in assets under management and supervision, Hamilton Lane (NASDAQ:HLNE) is an investment management firm that specializes in private markets, offering advisory services and fund solutions to institutional and private wealth investors.

Hamilton Lane reported revenues of $190.9 million, up 27.3% year on year, outperforming analysts’ expectations by 12.8%. The business had an incredible quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

The market seems happy with the results as the stock is up 10.5% since reporting. It currently trades at $126.97.

Is now the time to buy Hamilton Lane? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: P10 (NYSE:PX)

Operating as a bridge between institutional investors and hard-to-access private market opportunities, P10 (NYSE:PX) is an alternative asset management firm that provides access to private equity, venture capital, impact investing, and private credit opportunities in the middle and lower middle markets.

P10 reported revenues of $75.93 million, up 2.3% year on year, falling short of analysts’ expectations by 4.5%. It was a slower quarter as it posted a significant miss of analysts’ EBITDA estimates and a significant miss of analysts’ management fees estimates.

P10 delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 12% since the results and currently trades at $9.31.

Read our full analysis of P10’s results here.

Cohen & Steers (NYSE:CNS)

Founded in 1986 as a pioneer in real estate investment trusts (REITs), Cohen & Steers (NYSE:CNS) is an investment manager specializing in real estate securities, infrastructure, real assets, and preferred securities for institutional and individual investors.

Cohen & Steers reported revenues of $141.7 million, up 6.4% year on year. This print beat analysts’ expectations by 2.1%. It was a strong quarter as it also produced a decent beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.

The stock is down 9.3% since reporting and currently trades at $59.71.

Read our full, actionable report on Cohen & Steers here, it’s free for active Edge members.

Invesco (NYSE:IVZ)

With roots dating back to 1935 when it pioneered the first mutual fund with an objective of capital growth, Invesco (NYSE:IVZ) is a global asset management firm that offers investment solutions across equities, fixed income, alternatives, and multi-asset strategies.

Invesco reported revenues of $1.19 billion, down 21.7% year on year. This result was in line with analysts’ expectations. Overall, it was a very strong quarter as it also put up a beat of analysts’ EPS estimates and a solid beat of analysts’ AUM estimates.

Invesco had the slowest revenue growth among its peers. The stock is down 3.9% since reporting and currently trades at $22.55.

Read our full, actionable report on Invesco here, it’s free for active Edge members.

Market Update

Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

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