Financial Review: Bakkt (NYSE:BKKT) vs. Northern Trust (NASDAQ:NTRS)

Northern Trust (NASDAQ:NTRS) and Bakkt (NYSE:BKKT) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, dividends, earnings, institutional ownership and profitability.

Earnings & Valuation

This table compares Northern Trust and Bakkt”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northern Trust	$14.30 billion	2.16	$1.74 billion	$12.76	13.26
Bakkt	$2.34 billion	0.09	-$107.21 million	$0.45	10.29

Northern Trust has higher revenue and earnings than Bakkt. Bakkt is trading at a lower price-to-earnings ratio than Northern Trust, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations for Northern Trust and Bakkt, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northern Trust	2	11	2	0	2.00
Bakkt	1	0	1	0	2.00

Northern Trust presently has a consensus target price of $181.03, indicating a potential upside of 7.02%. Bakkt has a consensus target price of $12.00, indicating a potential upside of 159.18%. Given Bakkt’s higher possible upside, analysts plainly believe Bakkt is more favorable than Northern Trust.

Volatility & Risk

Northern Trust has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500. Comparatively, Bakkt has a beta of 6.06, suggesting that its stock price is 506% more volatile than the S&P 500.

Profitability

This table compares Northern Trust and Bakkt’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northern Trust	15.86%	17.97%	1.27%
Bakkt	-2.78%	-41.11%	-30.36%

Institutional & Insider Ownership

83.2% of Northern Trust shares are owned by institutional investors. Comparatively, 11.1% of Bakkt shares are owned by institutional investors. 0.7% of Northern Trust shares are owned by company insiders. Comparatively, 10.1% of Bakkt shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Northern Trust beats Bakkt on 10 of the 13 factors compared between the two stocks.

About Northern Trust

Northern Trust Corporation, a financial holding company, provides wealth management, asset servicing, asset management, and banking solutions for corporations, institutions, families, and individuals worldwide. It operates in two segments, Asset Servicing and Wealth Management. The Asset Servicing segment offers asset servicing and related services, including custody, fund administration, investment operations outsourcing, investment management, investment risk and analytical services, employee benefit services, securities lending, foreign exchange, treasury management, brokerage services, transition management services, banking, and cash management services. This segment serves corporate and public retirement funds, foundations, endowments, fund managers, insurance companies, sovereign wealth funds, and other institutional investors. The Wealth Management segment offers trust, investment management, custody, and philanthropic; financial consulting; guardianship and estate administration; family business consulting; family financial education; brokerage services; and private and business banking services. This segment serves high-net-worth individuals and families, business owners, executives, professionals, retirees, and established privately held businesses. The company also provides asset management services, such as active and passive equity; active and passive fixed income; cash management; muti-asset and alternative asset classes comprising private equity and hedge funds of funds; and multi-manager advisory services and products through separately managed accounts, bank common and collective funds, registered investment companies, exchange traded funds, non-U.S. collective investment funds, and unregistered private investment funds. In addition, it offers overlay and other risk management services. Northern Trust Corporation was founded in 1889 and is headquartered in Chicago, Illinois.

About Bakkt

Bakkt Holdings, Inc. offers software as a service and application programming interface solutions for crypto and loyalty, powering engagement, and performance. The company operates Bakkt Marketplace, a platform that enables consumers to buy, sell, and store crypto in an embedded web experience; Bakkt Crypto, a platform that supports clients with a range of crypto solutions; and Bakkt Trust, institutional-grade qualified custody solution for market participants. Its platform also offers a range of loyalty solutions, including redemption solutions for various rewards categories comprising travel, gift cards, and merchandise; travel solutions that offer a retail e-commerce booking platform, as well as live-agent booking and servicing; and unified shopping experience. The company was founded in 2018 and is headquartered in Alpharetta, Georgia.