Truist Adjusts State Street (STT) Outlook Following Strong Fee Growth, Higher Expense Forecasts

State Street Corporation (NYSE:STT) is one of the most undervalued quality stocks to buy right now. On January 20, Truist lowered its price target for State Street to $136 from $138 while keeping a Hold rating, following an update to the firm’s model after Q4 2025 results. The adjustment reflects an increase in the firm’s estimates driven by stronger fees, which were partially offset by higher expenses.

On the same day, Morgan Stanley also lowered its price target on State Street to $164 from $168 with an Overweight rating. Despite the company delivering a 6% beat on EPS, the stock fell 6% as investors reacted to the absence of updated medium-term targets. The firm noted that the market was further pressured by implied 2026 guidance that sat 3% below consensus expectations, alongside cautious management commentary regarding future expenses.

In Q4 2025, State Street Corporation (NYSE:STT) reported a 14% year-over-year increase in EPS, while the full-year revenue reached ~$14 billion. The firm achieved significant scale, surpassing $50 trillion in assets under custody and administration for the first time, while Assets Under Management climbed 20% to $5.7 trillion. Profitability remained high with a 20% return on tangible common equity and $500 million in annual productivity savings.

State Street Corporation (NYSE:STT) provides various financial products and services to institutional investors.

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Disclosure: None. This article is originally published at Insider Monkey.