What to Expect From 2 Megabanks Reporting Wednesday
The U.S. economy is building momentum and a large part of this has been the financial sector. A couple megabanks have contributed massively to the rally and are set to report their earnings on Wednesday.
[cnxvideo id=”655243″ placement=”ros”]The U.S. economy is building momentum, and a large part of this has been the financial sector. A couple megabanks that have contributed massively to the rally are looking to report their latest earnings on Wednesday.
So far the banks that have already reported, Bank of America, JPMorgan and Wells Fargo have been solid wins for the industry, as all of them are well positioned to take advantage of the new administration’s policy decisions and the overall market sentiment going forward.
The recent rate hike from the U.S. Federal Reserve might have been too late to impact the fourth-quarter of the major banks, but it sets an optimistic outlook for the industry. The question remains whether these results will set the tone for the rest of the earnings season.
Looking at the Financial Select Sector SPDR ETF (NYSEMKT: XLF), it has made strong gains since the November election. Specifically, it has gained 17.6% from November 8 to Friday’s close of $23.51, although this pales in comparison to some of the gains that these banks have made.
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Goldman Sachs Group Inc. (NYSE: GS) is scheduled to reveal its fourth-quarter results Wednesday morning. The consensus estimates call for $4.82 in earnings per share (EPS), as well as $7.72 billion in revenue. The same period of last year reportedly had EPS of $1.27 and $7.27 billion in revenue.
Shares were trading at $242.07 on Tuesday. The consensus price target is $240.04. The stock has a 52-week range of $138.20 to $247.77. So far the stock has gained 33% from November 8, but even more shocking a gain of 73.5% from the Brexit vote last summer.
The latest quarterly earnings from Citigroup Inc. (NYSE: C) are due early on Wednesday as well. The consensus fourth-quarter forecast calls for $1.12 in EPS and revenue of $17.3 billion. In the same period of last year, it posted EPS of $1.06 and $18.64 billion in revenue.
Its shares were last seen trading at $59.01, in a 52-week range of $34.52 to $61.63. The consensus price target is $64.31. So far the stock has gained 18% from November 8, but 53% since the Brexit vote.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
