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Jan 21 (Reuters) - State Street Corp (STT.N) is a "compelling" acquisition target, given its current price and operating earnings, said veteran banking analyst Richard Bove, who slashed his 2009 profit view on the company by 32 percent.
State Street's market capitalization is $6.4 billion, which is petty cash for companies like Bank of New York Mellon (BK.N) who should buy State Street immediately, Ladenburg Thalmann's Bove wrote in a note dated Jan. 20.
"The company has fought the market's view of how to value a going concern and it is losing (and) the company's credibility, as measured by its stock price change, has been dramatically weakened," Bove said.
Bove believes the synergies would be significant and the power over the market would be impressive if these companies got together.
On Tuesday, State Street, one of the world's biggest institutional money managers, reported $10 billion in unrealized losses on investments and commercial paper, and said quarterly profit fell 71 percent.
Bove, who rates the stock "buy," also slashed his price target by 50 percent to $25. [ID:nWNAB1521]
Shares of State Street were up 12 percent at $16.71 in mid-day trade on the New York Stock Exchange. (Reporting by Sweta Singh in Bangalore; Editing by Amitha Rajan)