Goldman Sachs Adds Northern Trust (NTRS) To Conviction Buy List

Goldman Sachs Group analysts Richard Ramsden, Brian Foran, Daniel Harris and Jessica Binder Graham upgraded shares of Northern Trust Corporation NTRS to Conviction List Buy. The analysts said that trust banks are equally levered in equity markets, interest rates and foreign exchange volatility. They said that because foreign exchange volatility has increased, Northern Trust Corporation's foreign exchange trading revenues should increase as well. The Goldman Sachs Group analysts wrote, "while all three trust banks offer FX volatility leverage, we choose Northern based on: (1) best-in-class capital with 8% tangible common equity vs. 6% for others, plus the lowest risk securities portfolio, and (2) more earnings sensitivity to FX trading (returning to 1H2009 levels adds 11% to NTRS EPS estimates vs. 3-5% for other trust banks)."