一般财报季从银行股开始.这个季度银行股的ER预测不好看
(Bloomberg) --Big bank stocks, including JPMorgan, BofA, Citigroup and Wells Fargo, slid Tuesday, one week ahead of what analysts expect will be a dismal earnings season.
• The KBW Bank Index (BKX) closed down 3.3% at the lowest since May 22; WFC fell 4%; C shed 3.2%; JPM and BAC dropped 2.8%
◦ The index has tumbled 37% so far this year, pummeled by economic fears as the pandemic unfolded and by low interest rates; banks have trailed the broader market, with the S&P 500 falling 2.7%
• “Results will be confusing, sloppy, and shocking” due to the Covid-19 crisis, RBC analyst Gerard Cassidy wrote in a note
◦ Even so, Cassidy said he’s “cautiously optimistic as we expect the economy to continue to gain momentum into the end of the year,” led by fiscal and monetary stimulus and businesses coming back on-line
◦ Estimates median EPS will drop 17% q/q, 56% y/y
• Large-cap banks will probably “show the highest quarterly loan loss provision since the financial crisis and the largest net interest margin drop in memory,” Barclays analyst Jason Goldberg wrote
◦ Goldman and Morgan Stanley may outperform on a relative basis, followed by money center banks (BAC, C, JPM), and then trust banks BNY Mellon, Northern Trust and State Street, as “robust trading revenues and investment banking fees, along with strong mortgage results, should provide some offset for those that have it”; large regional bank results are likely to be more challenged, with WFC and Capital One slated to post losses
◦ Goldberg cut 2Q EPS ests. for about two-thirds of covered banks, due to higher loan loss provisions and lower net interest margins (NIM), though he lifted ests. at GS, MS, STT, JPM because of higher market-related revenues
• “Uncertainty around credit” is in focus, even with a strong capital markets backdrop, Goldman analyst Richard Ramsden wrote
◦ He expects 2Q earnings will fall 69% y/y on larger reserve builds and near-0% interest rates; he also forecasts that WFC will lose money in the quarter
◦ He’ll listen for comments about dividend sustainability and the resubmission process for the Fed’s stress tests, known as CCAR; sees focus on 2H provisioning as big reserve builds are anticipated; sees “fairly limited normalization” in 2Q due to monetary and fiscal stimulus
▪ NOTE: June 30, Goldman Will Respond With ‘Back Against a Wall,’ Mike Mayo Says; June 29, Wells Fargo to Cut Dividend as Top Rivals Maintain Payouts
◦ Prefers MS and C, as they have the least rate sensitivity
• “Banks’ conservatism in reserving for expected net credit losses and their ability to earn through this loan loss reserve build” matters most this quarter, Credit Suisse’s Susan Roth Katzke wrote
◦ She models peak loss rates occurring in 4Q 2020/1Q 2021; “confidence in the manageability of those losses is key,” she said
◦ In 2Q, she sees capital markets as a likely “highlight, followed by mortgage banking and balance sheet growth;” offsets will include “sizable NIM compression, massive loan loss reserve build and deteriorating efficiency”
◦ Estimates earnings may drop ~65% y/y; a best case would be 2Q marking a “cyclical low point” for bank earnings
• UBS’s Saul Martinez sees elevated credit costs through mid-2021 and core NIM pressure in 2H and 2021
◦ Also expects “fewer buybacks as banks re-think optimal capital ratios”
◦ Sees “mostly good trends at JPM,” and further earnings downgrades for WFC, though the “bar is low on dividends”
• Analysts have made the biggest pre-earnings EPS estimate revisions in more than a decade, cutting their expectations for WFC earnings by 94% since the middle of April and slashing C’s by 70% and BAC and JPM by ~40%, according to Bloomberg data
(Bloomberg) --Big bank stocks, including JPMorgan, BofA, Citigroup and Wells Fargo, slid Tuesday, one week ahead of what analysts expect will be a dismal earnings season.
• The KBW Bank Index (BKX) closed down 3.3% at the lowest since May 22; WFC fell 4%; C shed 3.2%; JPM and BAC dropped 2.8%
◦ The index has tumbled 37% so far this year, pummeled by economic fears as the pandemic unfolded and by low interest rates; banks have trailed the broader market, with the S&P 500 falling 2.7%
• “Results will be confusing, sloppy, and shocking” due to the Covid-19 crisis, RBC analyst Gerard Cassidy wrote in a note
◦ Even so, Cassidy said he’s “cautiously optimistic as we expect the economy to continue to gain momentum into the end of the year,” led by fiscal and monetary stimulus and businesses coming back on-line
◦ Estimates median EPS will drop 17% q/q, 56% y/y
• Large-cap banks will probably “show the highest quarterly loan loss provision since the financial crisis and the largest net interest margin drop in memory,” Barclays analyst Jason Goldberg wrote
◦ Goldman and Morgan Stanley may outperform on a relative basis, followed by money center banks (BAC, C, JPM), and then trust banks BNY Mellon, Northern Trust and State Street, as “robust trading revenues and investment banking fees, along with strong mortgage results, should provide some offset for those that have it”; large regional bank results are likely to be more challenged, with WFC and Capital One slated to post losses
◦ Goldberg cut 2Q EPS ests. for about two-thirds of covered banks, due to higher loan loss provisions and lower net interest margins (NIM), though he lifted ests. at GS, MS, STT, JPM because of higher market-related revenues
• “Uncertainty around credit” is in focus, even with a strong capital markets backdrop, Goldman analyst Richard Ramsden wrote
◦ He expects 2Q earnings will fall 69% y/y on larger reserve builds and near-0% interest rates; he also forecasts that WFC will lose money in the quarter
◦ He’ll listen for comments about dividend sustainability and the resubmission process for the Fed’s stress tests, known as CCAR; sees focus on 2H provisioning as big reserve builds are anticipated; sees “fairly limited normalization” in 2Q due to monetary and fiscal stimulus
▪ NOTE: June 30, Goldman Will Respond With ‘Back Against a Wall,’ Mike Mayo Says; June 29, Wells Fargo to Cut Dividend as Top Rivals Maintain Payouts
◦ Prefers MS and C, as they have the least rate sensitivity
• “Banks’ conservatism in reserving for expected net credit losses and their ability to earn through this loan loss reserve build” matters most this quarter, Credit Suisse’s Susan Roth Katzke wrote
◦ She models peak loss rates occurring in 4Q 2020/1Q 2021; “confidence in the manageability of those losses is key,” she said
◦ In 2Q, she sees capital markets as a likely “highlight, followed by mortgage banking and balance sheet growth;” offsets will include “sizable NIM compression, massive loan loss reserve build and deteriorating efficiency”
◦ Estimates earnings may drop ~65% y/y; a best case would be 2Q marking a “cyclical low point” for bank earnings
• UBS’s Saul Martinez sees elevated credit costs through mid-2021 and core NIM pressure in 2H and 2021
◦ Also expects “fewer buybacks as banks re-think optimal capital ratios”
◦ Sees “mostly good trends at JPM,” and further earnings downgrades for WFC, though the “bar is low on dividends”
• Analysts have made the biggest pre-earnings EPS estimate revisions in more than a decade, cutting their expectations for WFC earnings by 94% since the middle of April and slashing C’s by 70% and BAC and JPM by ~40%, according to Bloomberg data