We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
STT Announces Plan for 10% Dividend Hike Post 2026 Stress Test Results
Read MoreHide Full Article
Key Takeaways
STT announces a 10% dividend hike plan in third-quarter 2026.
STT's new dividend, if approved by the board, will be 92 cents, up from the current 84 cents.
The company has $2.1B share repurchase authorization remaining available as of March 31, 2026.
State Street Corp. (STT - Free Report) intends to increase its quarterly dividend by 10% from 84 cents per share to 92 cents in third-quarter 2026, subject to approval by its board of directors. The announcement came yesterday, following the bank’s successful completion of this year’s stress test.
Per the test results, State Street’s Stress Capital Buffer will remain at the 2.5% floor through Sept. 30, 2027, and thus, its common equity tier 1 ratio requirement is unchanged at 8%. This reinforces the financial strength and resiliency of the company under adverse circumstances.
After clearing last year’s stress test, State Street had increased its quarterly dividend 11%, before which, the company had hiked annual dividends four consecutive times by 10%. STT currently has a five-year annualized dividend growth of 9.43% and its payout ratio is 30% of earnings. This indicates that it retains sufficient earnings for reinvestment and future growth initiatives while delivering lucrative returns to its shareholders.
Apart from regular dividend payouts, State Street enhances shareholder value through share repurchases. In January 2024, the company was authorized to repurchase shares worth up to $5 billion (with no expiration date). As of March 31, 2026, $2.1 billion worth of authorization remained available.
The company maintains a decent liquidity position. As of March 31, 2026, STT’s long-term debt was $25.2 billion, and other short-term borrowings were $4 billion, while cash and due from banks plus interest-bearing deposits with banks totaled $130.1 billion. Given its robust capital and liquidity position, the company is expected to sustain efficient capital distribution activities, through which it will keep boosting investor confidence in the stock.
STT’s Price Performance & Zacks Rank
Over the past six months, shares of State Street have gained 27.7%, outperforming the industry’s 13.3% growth.
JPMorgan (JPM - Free Report) intends to increase its quarterly dividend 10% to $1.65 per share in the third quarter of this year. Also, JPM’s board of directors authorized a common share repurchase program worth $50 billion, effective July 1, 2026.
Likewise, Morgan Stanley (MS - Free Report) plans to increase its quarterly common stock dividend to $1.15 per share from the current $1. Also, Morgan Stanley’s board of directors reauthorized a multi-year share repurchase program of up to $20 billion, without an expiration date, beginning in the third quarter of 2026.
View the Zacks #1 Rank List
Image: Bigstock
STT Announces Plan for 10% Dividend Hike Post 2026 Stress Test Results
Key Takeaways
State Street Corp. (STT - Free Report) intends to increase its quarterly dividend by 10% from 84 cents per share to 92 cents in third-quarter 2026, subject to approval by its board of directors. The announcement came yesterday, following the bank’s successful completion of this year’s stress test.
Per the test results, State Street’s Stress Capital Buffer will remain at the 2.5% floor through Sept. 30, 2027, and thus, its common equity tier 1 ratio requirement is unchanged at 8%. This reinforces the financial strength and resiliency of the company under adverse circumstances.
After clearing last year’s stress test, State Street had increased its quarterly dividend 11%, before which, the company had hiked annual dividends four consecutive times by 10%. STT currently has a five-year annualized dividend growth of 9.43% and its payout ratio is 30% of earnings. This indicates that it retains sufficient earnings for reinvestment and future growth initiatives while delivering lucrative returns to its shareholders.
Apart from regular dividend payouts, State Street enhances shareholder value through share repurchases. In January 2024, the company was authorized to repurchase shares worth up to $5 billion (with no expiration date). As of March 31, 2026, $2.1 billion worth of authorization remained available.
The company maintains a decent liquidity position. As of March 31, 2026, STT’s long-term debt was $25.2 billion, and other short-term borrowings were $4 billion, while cash and due from banks plus interest-bearing deposits with banks totaled $130.1 billion. Given its robust capital and liquidity position, the company is expected to sustain efficient capital distribution activities, through which it will keep boosting investor confidence in the stock.
STT’s Price Performance & Zacks Rank
Over the past six months, shares of State Street have gained 27.7%, outperforming the industry’s 13.3% growth.
Image Source: Zacks Investment Research
Currently, STT carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Capital Distribution Plans of Other Banks
JPMorgan (JPM - Free Report) intends to increase its quarterly dividend 10% to $1.65 per share in the third quarter of this year. Also, JPM’s board of directors authorized a common share repurchase program worth $50 billion, effective July 1, 2026.
Likewise, Morgan Stanley (MS - Free Report) plans to increase its quarterly common stock dividend to $1.15 per share from the current $1. Also, Morgan Stanley’s board of directors reauthorized a multi-year share repurchase program of up to $20 billion, without an expiration date, beginning in the third quarter of 2026.