Bank of New York Mellon: Financial Loser
The broad indexes all declined after IBM (IBM) reported first-quarter revenue of $24.67 billion and earnings of $2.78 a share. While Big Blue beat the consensus earnings estimate of $2.65, among analysts polled by Thomson Reuters, it missed the consensus revenue estimate of $24.77 billion.
Jim Cramer said he was sticking, with IBM, as "the company continues to transition to a hardware-light model, and that will produce some hiccups," adding that "the fact that business was strong in the United Kingdom and Spain -- Spain of all places -- makes me feel that the product that IBM offers is in need, no matter what."
Getting back to the financial names, the KBW Bank Index (I:BKX) declined 1% to close at 48.18, with 16 out of 24 index components showing declines.
Bank of New York Mellon reported first-quarter earnings per share of 52 cents, matching the consensus estimate.
The custody bank's first-quarter revenue -- excluding net securities gains or losses -- was $3.65 billion during the first quarter, coming in ahead of the consensus estimate of $3.59 billion, and increasing from $3.57 billion the previous quarter, and $3.60 billion a year earlier.
Jefferies analyst Ken Usdin rates Bank of New York Mellon a "Hold," with a $26 price target, and said there were "lots of pluses and minuses within revenues" during the first quarter, "but overall slightly better than expected," while "higher litigation expense muted progress on efficiency initiatives and kept EPS run-rates in check."
Among the "biggest positives," according to Usdin, were "a 13% rise in Asset Servicing and a 9% increase in Clearing Services," while "negative drivers" included "core FX (down 26%) and Issuer Services (down 13% due to Shareowner Services biz in 4Q11)," while "investment and other income held relatively flat ($139mm vs. $146mm in 4Q), which is likely unsustainable going forward."
The analyst estimates that the company will earn $2.20 a share during 2012, followed by EPS of $2.45 in 2013.
Bank of New York's shares have now risen 20% year-to-date, following a 33% decline in 2011.
The shares trade for nine times the consensus 2013 EPS estimate of $2.52. The consensus 2012 EPS estimate is $2.25.
Interested in more on Bank of New York Mellon? See TheStreet Ratings' report card for this stock .
Shares of New York Community Bancorp (NYB) pulled back over 2% to close at $13.33.