TT) ROIC is significantly lower than its peers, indicating inefficiencies in capital utilization.State Street Corporation (TT">NYSETT) is a financial services company that provides investment management, servicing, and administration. It operates globally, offering services to institutional investors. In the competitive landscape, State Street faces peers like Northern Trust Corporation, The Bank of New York Mellon Corporation, The PNC Financial Services Group, Comerica Incorporated, and Zions Bancorporation.
State Street's Return on Invested Capital (ROIC) is 0.56%, while its Weighted Average Cost of Capital (WACC) is 17.22%. This results in a ROIC to WACC ratio of 0.032, indicating that the company is not generating sufficient returns to cover its cost of capital. This suggests inefficiencies in how State Street utilizes its capital.
In comparison, Northern Trust Corporation has a ROIC of 2.69% and a WACC of 17.13%, resulting in a ROIC to WACC ratio of 0.157. This shows that Northern Trust is more effective in generating returns relative to its cost of capital than State Street. Similarly, The PNC Financial Services Group has a ROIC of 2.42% and a WACC of 13.33%, with a ROIC to WACC ratio of 0.182, further highlighting State Street's underperformance.
Zions Bancorporation stands out with a ROIC of 7.30% and a WACC of 18.63%, leading to a ROIC to WACC ratio of 0.392. This indicates that Zions is highly efficient in using its capital to generate returns, outperforming State Street and other peers. This efficiency suggests better financial health and capital utilization for Zions compared to State Street.
