Earnings Crunch Begins: Big Banks In The Spotlight

  • The third-quarter earnings crunch begins this week.
  • Many big banks are scheduled to report, but expectations are muted for them overall.
  • Well Street expectations are low for others as well, including Dow components GE and Intel, as well as Netflix.

The quarterly reporting crunch begins in earnest this week, and many of the big banks will be taking their turns in the earnings spotlight, including Bank of America Corp BAC, Citigroup Inc C, JPMorgan Chase & Co. JPM and Wells Fargo & Co WFC.

The consensus forecasts of Wall Street analysts for these are rather muted, with small declines in revenue anticipated from three of them, and modest earnings growth from two, relative to the year-ago period.

Below is a quick look at what is expected from these and a few of the week's other most prominent reports.

See also: JC Parets: Stay Away From Banking Stocks

Bank of America

This leading money center bank will post earnings of $0.37 per share for its third quarter, if Estimize's consensus forecast is accurate. That would compare to a net loss $0.04 per share in the same period of last year. Note that Estimize overestimated Bank of America earnings in the previous period.

The 59 Estimize survey respondents see revenue for the three months that ended in September at $21.45 billion. That is about the same as in the year-ago quarter, and higher than the Wall Street estimate of $20.85 billion. Watch for the Bank of America to report before Wednesday's opening bell.

Citigroup

In its report early Thursday, this New York-based bank is expected to say that its earnings per share came to $1.42 for the period that ended in September. That compares to the $1.28 per share expected by Wall Street, and the $0.88 per share Citi posted in the year-ago period.

The consensus of 30 Estimize estimates has revenues at $19.38 billion for the third quarter, also higher than Wall Street expectations for $18.63 billion. Both would be down from the $19.98 billion posted in last year's quarter, but note that Estimize overestimated revenue back in the second quarter.

JPMorgan

The third-quarter forecast for this financial titan calls for EPS to have risen from $1.36 in the year-ago period to $1.45, according to 95 Estimize respondents. Revenue is expected to have retreated around 5 percent to $24.22 billion for the three months that ended in September.

The Wall Street forecast calls for $1.37 per share earnings and $23.70 billion in revenue for the quarter. Note though that volatile results in recent periods have often defied the consensus expectations. JPMorgan is scheduled to release its results Tuesday after the regular trading session concludes.

Wells Fargo

When it shares its results early Wednesday, the consensus of 45 Estimize estimates is that this San Francisco-based bank will show earnings of $1.06 per share. That would be up from $1.02 per share in the same period of last year. Both Estimize and Wall Street overestimated EPS in the previous quarter.

Revenue for the three months that ended in September will be around 2 percent higher than a year ago to $21.73 billion, if Estimize is correct. Wall Street is slightly more optimistic, with a $21.75 billion forecast. Note that they both overestimated revenue back in the second quarter.

See also: What's Coming For Netflix This Earnings Season?

And Others

Among the other financial companies expected to report this week, Wall Street anticipates seeing year-on-year EPS gains from KeyCorp, People's United Financial, Progressive and U.S. Bancorp. But they foresee smaller profits from BB&T, BlackRock, Blackstone, Comerica, Goldman Sachs, PNC Financial, SunTrust Banks and Synchrony Financial.

Of course, banks are not the only companies expected to share their latest quarterly results this week. The consensus forecasts call for at least some bottom-line growth from Delta Air Lines, Fastenal, Honeywell and UnitedHealth. But a year-on-year decline in earnings is coming from General Electric, Intel, Johnson & Johnson, Netflix, Philip Morris and Schlumberger, if Wall Street estimates are accurate.

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