Why Northern Trust Stock Zoomed 11% Higher This Week

Very often, when a publicly traded company is the focus of takeover interest, investors are attracted to its stock. That was the case earlier this week when a media report stated that banking conglomerate Northern Trust (NASDAQ: NTRS) had been approached by a potential suitor.

That juiced its shares, which, according to data compiled by S&P Global Market Intelligence, ended the week more than 11% higher in price.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

An apparent suitor

On Sunday, The Wall Street Journal broke the news that Bank of New York Mellon (NYSE: BK) indicated to Northern Trust that it desired a merger with the smaller banking group. This quickly made its way to the highest levels of management, as according to unnamed "people familiar with the matter," the CEOs of the two companies had at least one conversation on a potential deal.

Image source: Getty Images.

The newspaper's sources said the discussions didn't advance to talks of a specific offer. At the time, it reported that Mellon is mulling its next move. This might indeed result in a formal offer being made. While the Journal used the word "merger" in writing about a potential deal, in all likelihood, any sort of arrangement would be more of an acquisition by Mellon.

Given that, it won't be a cheap purchase. Northern Trust's market cap is over $24 billion, which would mean a hefty price tag, even at a modest premium.

An unfolding saga worth following

Neither Northern Trust nor Mellon has yet publicly commented on the report, and I wouldn't expect them to if talks are indeed at an early stage. I'd imagine any premium paid will be somewhat generous, given Mellon's apparent eagerness to bulk up with an already-sizable asset.

This story is well worth monitoring for shareholders of both banks.

Should you invest $1,000 in Northern Trust right now?

Before you buy stock in Northern Trust, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Northern Trust wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $704,676!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $950,198!*

Now, it’s worth noting Stock Advisor’s total average return is 1,048% — a market-crushing outperformance compared to 175% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.