The Bank of New York Mellon Corporation BK is scheduled to report first-quarter 2025 results on April 11, before market open. The company’s quarterly revenues and earnings are expected to have increased on a year-over-year basis.

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In the last reported quarter, BK’s earnings surpassed the Zacks Consensus Estimate. Results were primarily aided by a rise in fee revenues and net interest income (NII) alongside lower provisions and non-interest expenses. Also, higher assets under custody and/or administration and assets under management balances were positives.
 
BNY Mellon has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with the average beat being 8.01%.

The consensus estimate for the company’s first-quarter earnings is pegged at $1.49 per share, which has been revised marginally downward over the past seven days. This indicates a rise of 15.5% from the year-ago quarter’s reported number.

The consensus estimate for sales is pegged at $4.73 billion, implying 4.5% growth.

Factors to Impact BNY Mellon’s Q1 Results

Fee Revenues: The Zacks Consensus Estimate for total investment services fees (comprising more than 50% of the company’s total revenues) is pegged at $2.39 billion, suggesting a rise of 4.7% from the year-ago quarter. Our estimate for the metric is $2.37 billion.

The consensus mark for financing-related fees stands at $54.7 million, which suggests a 4.1% year-over-year decline. Our estimate for financing-related fees is $54.3 million.

The consensus estimate for distribution and servicing fees is pegged at $39 million, implying a 7.1% decline. Our estimate for the same is $41.6 million.

In the first quarter, foreign exchange (FX) trading activity was driven by heightened market volatility and increased hedging demand amid global economic uncertainties. Further, higher-for-longer interest rates and concerns regarding a potential trade war, given Donald Trump’s tariff policies, weakened the dollar. Thus, increased FX trading volumes are likely to have had a positive impact on BNY Mellon’s FX revenues, partially offset by a weak dollar performance. The consensus estimate for foreign exchange revenues stands at $181.8 million, suggesting a jump of 19.6%. Our estimate for the same is $176.5 million.

The consensus estimate for total fees and other revenues is $3.44 billion, suggesting a rise of 4.1%. We project the metric to be $3.60 billion.

NII: The Federal Reserve kept interest rates unchanged at 4.25%-4.5% during the first quarter of 2025 amid sticky inflation concerns. This is likely to have positively impacted BK’s NII during the first quarter, given relatively higher yields on interest-earning assets, partially offset by higher funding costs.

Further, the yield curve steepened during the quarter due to economic uncertainties, which is likely to have offered further support for reinvestment yields.

However, a cautious stance regarding future rate cuts by the Fed and a tough operating backdrop is likely to have subdued the overall lending scenario to some extent. Per the latest Fed data, overall loan demand improved in the first two months of the quarter.

The consensus mark for NII is pegged at $1.12 billion, indicating an 8.1% year-over-year rise. We expect NII to be $1.08 billion.

Expenses: Because of higher restructuring charges and buyouts, BNY Mellon’s expenses have been elevated over the past few years. In the first quarter, overall costs are expected to increase, driven by inflationary pressure, technology upgrades and a multi-year transformation plan.

Our estimate for non-interest expenses is $3.38 billion, suggesting a 6.3% year-over-year rise.

What the Zacks Model Unveils for BNY Mellon

According to our quantitative model, the chances of BNY Mellon beating the Zacks Consensus Estimate this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.

You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for BNY Mellon is +0.01%.

Zacks Rank: The company currently carries a Zacks Rank #3.

Other Bank Stocks That Warrant a Look

A couple of bank stocks that also have the right combination of elements to post an earnings beat in their upcoming releases are U.S. Bancorp USB and State Street Corporation STT.

USB has an Earnings ESP of +0.94% and it carries a Zacks Rank of 3 at present. The company is slated to report first-quarter 2025 results on April 16. Over the past seven days, the Zacks Consensus Estimate for USB’s quarterly earnings has been revised 2.1% upward to 99 cents.

STT is scheduled to release its first-quarter 2025 earnings on April 17. The company has an Earnings ESP of +2.36% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Quarterly earnings estimates for STT have remained unchanged at $1.98 over the past week.

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The Bank of New York Mellon Corporation (BK) : Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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