As the earnings season has just kicked off, we are now hailing some of the first reporters, which are the major banks. Quarterly performance is just one issue, and investors might want to pay more attention to what the banks have to say about the looming Federal Reserve rate hikes. Note that these are not all the sector players with earnings reports; this week will be full of regional and other financial stocks.
24/7 Wall St. has put together a preview of some of the major financial companies reporting their quarterly results this week. We have included the consensus earnings estimates from Thomson Reuters and the stock price and trading history, as well as added some additional color on each.
Be sure to check out our preview of the major Dow stocks kicking off earnings season.
Be advised that the earnings and revenue estimates may change ahead of the formal reports, and some companies may change reporting dates as well.
JPMorgan Chase & Co. (NYSE: JPM) will release its most recent quarterly results Tuesday. The consensus estimates are $1.37 in earnings per share (EPS) on $23.72 billion in revenue. This stock trades at a very low 10.6 times estimated forward earnings. JPMorgan is expected to benefit from commercial loan growth and an upturn in capital spending. Wall Street analysts agree that the stock seems attractively valued on 2015 estimated price to earnings and a very solid price-to-book value. Some on Wall Street have cautioned that last year’s divestiture of the physical commodities business could provide an earnings headwind throughout this year.
At the end of Friday’s trading session, shares were at $61.94. The consensus price target is $73.43, and the 52-week trading range is $50.07 to $70.61.
Wells Fargo & Co. (NYSE: WFC) is scheduled to report its third-quarter results on Tuesday. The consensus estimates call for $1.05 in EPS and $21.76 billion in revenue. Wells Fargo may see a solid benefit when yields start moving higher. In the meantime, analysts like the bank’s diverse business model, which protects against current low rates. Wells Fargo has slowly, but surely, become one of the biggest mortgage lending companies in the United States, in addition to its normal banking and brokerage businesses. An increase in commercial real estate lending could really boost the bank’s bottom line, which some on Wall Street feel could aid a big return in capital to shareholders. The stock also remains a top Warren Buffett holding.
Shares closed trading at $52.14 on Friday, below the consensus analyst price target of $58.93. The 52-week trading range is $46.44 to $58.77.
Bank of America
Bank of America Corp. (NYSE: BAC) is scheduled to report its third-quarter earnings on Wednesday. The consensus estimates call for EPS of $0.34 and $20.88 billion in revenue. This bank is a ubiquitous presence in the United States, providing various banking and financial products and services for individual consumers, small and middle market businesses, institutional investors, corporations and governments in the United States and internationally. It operates 5,100 banking centers, 16,300 ATMs, call centers, and online and mobile banking platforms.
Shares were at $15.58 as the week’s trading came to a close. The consensus price target is $19.00, and the stock has a 52-week trading range of $14.60 to $18.48.
Citigroup Inc. (NYSE: C) will release its most recent quarterly results Thursday. The consensus estimates have EPS at $1.28 on $18.62 billion in revenue. The stock is very cheap, trading at just 9.2 times estimated 2015 earnings, and is the nation’s fourth-largest bank by assets. Numerous Wall Street analysts cite the fact that Citigroup will be a leader in buyback payouts to shareholders. Combined with the bank’s strong domestic and international business, and a better overall economy, plus the headline risk over bank stress tests being removed, share purchases look wise here.
In Friday’s trading session, shares closed at $51.38. The consensus price target is $64.30, and the 52-week trading range is $46.60 to $60.95.
Goldman Sachs Group Inc. (NYSE: GS) is set to report its earnings on Thursday. The consensus estimates are for EPS of $3.23 and revenue of $7.52 billion. This company continues to be the gold standard of Wall Street banks and trades at a low 10.8 times estimated forward earnings. Goldman has a gigantic institutional equity, debt and derivatives business, an ultra-high net worth clientele, top investment banking and capital markets expertise, and the firm continues to be a dominant force around the world. The bank is one of the most sought after in the world, and it is one of the very few firms that dictate who can be a client.
Shares changed hands at the end of the week at $179.19. The stock has a consensus price target of $211.75. Shares have traded between $167.49 and $218.77 in the past year.