Cost cutting spurs State Street

Article Excerpt

STATE STREET CORP. $99 (New York symbol STT; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 367.7 million; Market cap: $36.4 billion; Price-to-sales ratio: 3.3; Dividend yield: 1.7%; TSINetwork Rating: Average; www.statestreet.com) sells accounting and administrative services to operators of mutual funds and pension plans. It also offers banking services. Thanks to new contracts and stock market gains, State Street’s revenue in the fourth quarter of 2017 rose 12.5%, to $2.85 billion from $2.53 billion a year earlier. If you disregard unusual items, including a $270 million charge associated with changes to the U.S. tax code, earnings jumped 19.1%, to $687 million from $577 million; per-share earnings gained 23.6%, to $1.83 from $1.48, on fewer shares outstanding. The company continues to benefit from its multi-year cost-cutting plan. So far, State Street has saved $325 million. Those savings should total $550 million by the time it completes the plan in mid-2019. State Street is a buy. buy…

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