State Street Corporation (STT)
Valuation Overview•Is State Street Corporation Overvalued or Undervalued?
Trading at a discount compared to peers, but the underlying intrinsic cash flows struggle to support the current price.
Moderate quality score of 54/100, reflecting stable operating margins and manageable leverage.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Average quality business weighed down by significant solvency concerns.
Wall Street sentiment is generally neutral alongside robust expected earnings growth. This is paired with healthy capital returns, driven by a balanced mix of reliable dividends and share buybacks.
STT demonstrates adequate business quality with stable profitability. This is backed by a fortress balance sheet, holding significant net cash ($101.6B) and minimal debt risk.
The company maintains stable top-line performance paired with robust earnings compounding (9.3% EPS 3Y CAGR). The company maintains healthy operational efficiency with a 16.5% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $5.6B | +3.0% | — | — | +7.7% | |
| EBITDA | $1.1B | — | -1.5% | — | — | |
| Net Income | $747.0M | +9.6% | +2.0% | — | +4.0% | |
| EPS (Diluted) | $2.41 | +14.5% | +9.3% | +8.3% | +7.7% | |
| Free Cash Flow | $1.2B | +130.4% | -27.4% | +7.6% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 61.4% | 61.5% | 74.7% | 84.2% |
| Operating Margin | 16.5% | 14.8% | 19.0% | 20.9% |
| Net Margin | 13.0% | 11.9% | 15.7% | 17.4% |
| FCF Margin | 12.1% | -15.4% | -5.3% | 17.8% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $2.64 | $2.84 | +7.6% | ||
| Q1'26 | $2.84 | $2.97 | +4.6% | ||
| Q4'25 | $2.64 | $2.78 | +5.3% | ||
| Q3'25 | $2.35 | $2.53 | +7.7% | ||
| Q2'25 | $2.00 | $2.04 | +2.0% | ||
| Q1'25 | $2.29 | $2.60 | +13.5% | ||
| Q4'24 | $2.12 | $2.26 | +6.6% | ||
| Q3'24 | $2.03 | $2.15 | +5.9% |
Total return is +72.8% (1Y), outperforming the benchmark by +47.8%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +31.7% | +22.4% | — |
| 1Y | +72.8% | +47.8% | +3.3% |
| 3YCAGR | +34.3% | +15.5% | +12.2% |
| 5YCAGR | +18.2% | +4.9% | +17.3% |
| 10YCAGR | +12.5% | -0.8% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about State Street Corporation (STT) valuation, health, and returns.
State Street Corporation is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Slightly cheap versus peers compared to industry peers. overvalued (implying -15.9% downside from DCF intrinsic value of $141.56)
State Street Corporation has multiple valuation anchors: DCF Intrinsic Value: $141.56 | Peer Relative Fair Value: $186.62 | Wall Street Analyst Target: $161.50 (implying -4.0% upside). A convergence of these signals offers higher conviction.
State Street Corporation displays fair financial health with a composite quality score of 54/100, supported by a Piotroski F-Score of 7/9, Return on Invested Capital (ROIC) of 4.7%.
State Street Corporation pays a 1.8% dividend yield, covered by a 30% payout ratio with 15 years of growth, supplemented by a 2.7% buyback yield.
State Street Corporation's current growth trajectory is Decelerating. The company achieved +3.0% 1Y revenue growth and +14.5% 1Y EPS growth, compared to its 3Y revenue CAGR of N/A.
Wall Street consensus is Buy based on 37 analysts, beating EPS expectations in 100% of recent quarters with a 12-quarter streak. The consensus price target represents a -4.0% change from current levels.
Investment risks for State Street Corporation include: -11.8% 1-year max drawdown. Volatility risk is characterized by a beta of 1.14x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.