S&P Capital IQ Reiterates its BUY Rating on State Street, Target Price Reduced

October 19 00:00 2011

NEW YORK, October 19 (RainbowNewsLine.com) – Analyst Erik Oja of S&P Capital IQ maintains BUY rating on the shares of State Street Corp (NYSE: STT). The target price is reduced from $49 to $42.

Analyst Erik Oja, in a research note published yesterday mentions that the company reported Q3 GAAP EPS ahead of the estimates. If one time item is excluded the Q3 EPS was $0.96 which misses the estimate by $0.4 on lower than expected servicing fees. The ’11 EPS estimate has been raised from $3.93 to $4.08 reflecting the Q3 GAAP results and higher revenue forecast for Q4. The analyst believes that State Street’s shares are attractively valued at their forward four-quarter EPS estimate of $4.21, which is below their historical levels. The target price is reduced based on forward four quarters EPS estimate whose multiple is closer to the mean of historic levels, the analyst adds.