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State Street's stock dips but analysts see 19% upside potential ahead

A rocky few months for State Street's stock hasn't shaken analyst confidence. Could a new ETF and long-term gains rewrite its 2024 story?

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2 min read
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State Street's stock dips but analysts see 19% upside potential ahead

State Street Corporation, a Boston-based financial giant, has seen its stock performance weaken in recent months. The company, known for services like custody, investment management, and data analytics, now trades well below its January peak. Despite this dip, analysts remain cautiously optimistic about its future.

State Street's shares have fallen nearly 5% over the past three months, a smaller decline than the broader financial sector, which dropped 11.3% in the same period. Year-to-date, the stock is down roughly 6%, compared to a 10.7% fall in the Vanguard Financials ETF (VFH). However, over the last 52 weeks, State Street outperformed the sector with a 43.7% gain, while VFH rose just 4.5%.

The company's stock currently sits 11.5% below its 52-week high of $137.05, reached in January. Since February, it has traded under its 50-day moving average of $129 but remains above the 200-day average of $117.05. Despite this volatility, State Street's market capitalisation stands at around $33.8 billion, keeping it in the large-cap category.

In March, State Street Investment Management expanded its offerings by launching the State Street® IG Public & Private ABS ETF (PRAB). This new fund aims to give investors broader access to asset-backed securities. Meanwhile, the firm's market value has followed a trend seen among other major US financial companies, including BlackRock and Vanguard, which rank higher in asset management.

Analysts currently rate State Street as a 'Moderate Buy,' with an average price target of $144.79. This suggests a potential upside of about 19.3% from its present level.

State Street continues to navigate a challenging market environment, with its stock underperforming in the short term but showing stronger gains over the past year. The launch of its new ETF reflects ongoing efforts to diversify investor options. With a market cap of $33.8 billion and analyst projections pointing to possible growth, the company remains a significant player in the financial sector.

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