Earnings Reports

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Bank of America reported better than expected second quarter earnings before the bell Wednesday. $BAC consumer banking led growth with stock buybacks also contributing to rising EPS. JPMorgan Chase $JPM. Wells Fargo $WFC, PNC Financial $PNC Goldman Sachs and  Citigroup have all reported also.

Bank of America Mortgage

Bank of America Corporation NYSE: BAC Reported Earnings Before Open Wednesday

$0.74 Beat $0.71 EPS Forecast and $23.23 billion Beat $23.16 Billion Forecast in Revenue

Earnings

Bank of America earnings rose 17% to 74 cents per share on revenue of $23.233 billion with consumer banking leading the way. Stock buybacks again contributed to rising earnings per share. However the bank’s net interest margin, a key metric of bank profitability, declined 7 basis points from the first quarter to 2.44%, below the 2.47% estimate.

Earnings Forecast

  • 2Q adjusted EPS estimate 71c (range 67c to 75c)
  • 2Q revenue net of interest expense estimate $23.16 billion (range $22.78 billion to $23.72 billion)
  • 4Q equities trading revenue estimate $1.21 billion (Bloomberg MODL, 7 ests.)
  • FICC $2,12 billion (7 ests.)
  • I-banking revenue est. $1.41 billion
  • 2Q net interest yield estimate 2.46% (range 2.41% to 2.5%)
  • 2Q Preview Call 8:30am 877-200-4456 password: 79795

Analysts cut estimates for Goldman, Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., Morgan Stanley, and Wells Fargo & Co. by an average of 8.1 percent before the last quarter’s earnings reports. Goldman's estimates were cut by 27 percent.

Bank of America Corporation NYSE: BAC

Market Reaction: Pre-market $28.85 −0.14 (-0.48%)

Highlights

“Our commitment to responsible growth resulted in the best quarter and first-half year of earnings in our company’s history,” Moynihan said in the earnings release. “We see solid consumer activity across the board, with spending by Bank of America consumers up five percent this quarter over the second quarter of last year.”

  • Consumer banking, firm’s biggest division, profit rose 13% to $3.29 billion and revenue climbed 5% to $9.72 billion
  • Wealth management division rofit rose 11% to $1.07 billion.
  • Global markets division fell 7% to $1.07 billion amid a slowdown in trading activity across asset classes.
  • Fixed income trading revenue dropped 8 percent to $2.13 billion
  • Equities trading fell 13 percent to $1.15 billion, just below the $1.22 billion estimate.
  • Global banking division profit declined 9% to $1.93 billion on a drop in capital markets deals. .
  • Net interest yield was 2.44%, up 3 basis points from last year.
  • Provision for credit losses remained broadly unchanged at $857 million during the quarter, while book value per share rose 10% to $26.41.
  • Helped by increased interest rates and growth in loans and deposits. 

“Diluted EPS grew seventeen percent from the year-ago quarter, aided in part by the repurchase of seven percent of our shares in the past twelve months as book value per share grew ten percent and capital and liquidity measures strengthened. We have recorded eighteen consecutive quarters of positive operating leverage while consistently making significant investments in the franchise,” said CFO Paul Donofrio.

Bank of America Q2 2019 earnings

The bank had $13.27 billion in noninterest expenses, just under the $13.31 billion estimate of analysts surveyed by FactSet. The firm’s efficiency ratio, which reflects how much expenses consum

Bank of America Q1 Earnings Recap

$.070 Beat $0.66 EPS Forecast AND $23.0B Million $23.3 Billion Forecast in Revenue

Earnings 

Bank of America Corp. (NYSE: BAC) released Q1 earnings before the market Tuesday with profit up 6% to $7.3 billion, or 70 cents a share, exceeding analysts’ estimate of 66 cents a share. Revenue was roughly unchanged from a year earlier at $23 billion,under $23.3 billion in revenue. The same period of last year reportedly had $0.62 in EPS and $23.27 billion in revenue.

Analysts on BAC

  • Barclays Hold rating.
  • HSBC  Hold rating with a $29 price target.
  • Jefferies Buy rating with a $33 price target.
  • Oppenheimer Outperform rating with $40 price target.
  • Wells Fargo Buy rating with a $36 pricr target.
  • UBS Group Buy rating with  $33 price target.

Analysts have cut estimates for Goldman, Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., Morgan Stanley, and Wells Fargo & Co. by an average of 8.1 percent before the last quarter’s earnings reports. Goldman's estimates were cut by 27 percent.

Bank of America Corporation NYSE: BAC

Market Reaction: Pre-market $29.61 −0.23 (0.77%)

Highlights

“Economic growth and consumer activity in the U.S. continue to be solid, businesses of every size are borrowing and driving the economy, and asset quality is strong,” Moynihan said in the release. “It was a challenging capital markets environment but our team and platform are optimized to serve clients and generate stable revenues across a range of market conditions over time.”

  • BA’s net interest yield, a key metric of profitability for a bank’s core lending activities, rose 9 basis points to 2.51%
  • Loans across the firm’s consumer and commercial businesses rose 3%
  • Deposits rose 5% to $1.4 trillion.
  • Consumer lending business  25% increase in profit to $3.2 billion.with revenue in the business 7% to $9.6 billion while reducing costs by almost $200 million.
  • Global markets profit slumped 26% to $1 billion.
  • Revenue dropped 13% on weak trading results and lower investment banking fees.
  • Equities trading revenue fell 22%,
  • Fixed income declined 8%.
  • Global banking business posted a 2% profit increase to $2 billion.
  • Wealth management profit rose 14% to $1 billion.

 

 Source: BAC, AlphaStreet

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