) two most important business division - asset servicing and asset
& wealth management - accounts for roughly 27% and 26% of the
company's stock value respectively. BNY Mellon primarily competes
with State Street (NYSE:STT),
(NYSE:JPM) and Citigroup (
) in providing investment servicing (asset servicing, issuer
services, clearing services) and investment management services to
institutional investors around the world.
We have a
$35.76 Trefis price estimate for BNY Mellon
, significantly above the market price. Below we look at the
potential upside and downside scenarios for BNY Mellon's stock.
4% Upside Scenario: $37.25 Trefis Price Estimate for BNY
BNY Mellon's Assets under Custody
We currently forecast BNY Mellon's AuC will increase from $25
trillion in 2010 to over $43 trillion in the coming years. However,
a higher growth in BNY Mellon's to over $50 trillion driven by a
faster than expected growth in emerging markets would mean an
upside of 3-4% to the Trefis price estimate.
8% Downside Scenario: $33.12 Trefis Price Estimate for
BNY Mellon's Assets under Management
We currently forecast BNY Mellon's AuM will increase from $1.2
trillion in 2010 to over $2.25 trillion by the end of our forecast
driven by rising inflow of funds from emerging markets.
However, a much slower growth to only $1.5 trillion would result
in a downside of 7-8% to the Trefis price estimate for BNY Mellon.
Such a scenario can come into play as more and more people invest
through online brokerage network, which increasingly offer
sophisticated value-added services such as advisory, reporting and
portfolio tracking thereby reducing funds inflows to asset
See our full analysis for BNY Mellon's stock