Home Business US quarterly, we start with the banks. The expectations of analysts

US quarterly, we start with the banks. The expectations of analysts

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Key week that started today to verify the state of American industry with the first US quarterly reports relating to the last three months of 2021. In particular, to kick off the dances, there will be the big Wall Street banks. The perspective of interest rates higher this year scares investors in tech stocks and other high-growth sectors. But the music is different for the big banks. Banks will benefit from the rising cost of borrowing, as long as they don’t go up too quickly and thus end up hurting demand for mortgages, credit cards and other loans.

The financial companies are thriving thanks to the stock market boom, which helped to revive the trading activity. The surge in stocks has also fueled increased demand for mergers and IPOs, which led to an increase in bank fees.

All this pushes analysts to forecast strong growth profits. An example for all. Analysts expect JPMorgan Chase earnings per share to have risen nearly 70% in 2021.

US quarterly: the calendar

Among the banks that will announce the quarterly reports in the US, Friday 14 will be JPMorgan Chase, Citi and Wells Fargo to lift the veil on the fourth quarter. On the same day, the data will also be revealed to BlackRock (BLK), the largest wealth manager in the world. Tuesday 18 January will be the turn of Morgan Stanley (MS) and Goldman Sachs (GS) while US Bancorp, Bank of America they will close the data season on Wednesday 19 January.

Earnings Estimates

Given that in general the last three months of 2021 should confirm the good trend recorded in the previous quarter, let’s see the FacSet estimates in detail:

  • JpMorgan Chase: Earnings per share of $ 3 on $ 29.85 billion in revenue
  • Wells Fargo: Earnings per share of $ 1.10 on $ 18.67 billion in revenue
  • Citigroup: earnings per share of $ 1.55 on revenue of $ 16.92 billion.
  • Bank of America: earnings per share of 77 cents against revenues of $ 22.17 billion;
  • Goldman Sachs: Earnings per share of $ 11.75 per share on revenue of $ 12 billion
  • Morgan Stanley: earnings per share of $ 1.94 on revenue of $ 14.57 billion.

Wall Street analysts have theorized that raising interest rates will allow banks to increase net interest margins on loans. The repercussions on stocks were positive.

The actions of Goldman Sachs they have increased by almost 47% in the last 12 months; JPMorgan earned 31%; Wells Fargo is about 75% ahead over the same period e Morgan Stanley it was up about 48%, along with a 48% jump in shares of Bank of America. Citigroup has grown about 5.5% in the past year as the laggard in the group.

Banking stocks got off to a good start in 2022, extending gains from the second half of last year.
L” Invesco KBW Bank ETF (KBWB), including Bank of America (BAC), Wells Fargo (WFC), JPMorgan Chase (JPM), US Bancorp (USB) and Citigroup (C), is up by more than 8% already this year and has gained over 19% in the last six months, outperforming the market.

Not only useful, expected statements on smart working

Several large Wall Street banks, including JPMorgan Chase, Goldman Sachs and BlackRock, have delayed plans to get their employees back to the office despite pressure from Eric Adams, the new mayor of New York City, to bring people back to the offices of the Big Apple. Then there are those, like Citigroup, who have decided to fire unvaccinated employees.
There are concerns that the Federal Reserve may raise rates more aggressively than expected this year in order to contain inflation. If that happens, it could put a thrill in both the housing and stock markets.

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