US banks are set to report mixed second quarter earnings, starting off with JPMorgan Chase & Co (NYSE:JPM), Wells Fargo & Company (NYSE:WFC), and Citigroup Inc (NYSE:C) which are all handing down their latest financial results on Friday, July 14.
Bank of America Corp (NYSE:BAC) and Morgan Stanley (NYSE:MS) will follow on Tuesday, July 18, with Goldman Sachs (NYSE:GS) to report on Wednesday, July 19.
Wells Fargo and JP Morgan are expected to post the highest profit growth when compared to the year-ago quarter, while Citigroup, Morgan Stanley (NYSE:MS), and Goldman Sachs (NYSE:GS) are expected to report a drop in profit.
According to Forex.com market analyst Joshua Warner, the difference in performance at the bottom line will ultimately come down to two areas of exposure.
First is to rising interest rates and the other is to separate activities such as investment banking, trading and wealth management where conditions remain tough, Warner noted.
During 2Q, the finance sector as a whole is forecast to report 10.9% growth in earnings and 6.2% higher revenue, Zacks Consensus Estimate (ZCE) reported.
Improved profitability is expected to be offset in part by continued weakness in investment banking and challenges for trading businesses, the firm added.
"Earnings estimates for 2Q have dropped since the quarter got underway, but the magnitude of cuts to estimates has been notably below what we saw in other recent comparable periods,” commented ZCE research director Sheraz Mian.
Here’s what the Street expects from some of the biggest banks in terms of earnings per share (EPS) and revenue:
JP Morgan:
- EPS estimate: $3.67 compared to $2.76 in 2Q 2022
- Revenue estimate: $38.9 billion compared to $31.82 billion in 2Q 2022
Wells Fargo:
- EPS estimate: $1.16 compared to $0.74 in 2Q 2022
- Revenue estimate: $20.08 billion compared to $17.50 billion in 2Q 2022
Citigroup:
- EPS estimate: $1.45 compared to $2.30 in 2Q 2022
- Revenue estimate: $19.58 billion compared to $18.36 billion in 2Q 2022
Bank of America:
- EPS estimate: $0.85 compared to $0.73 in 2Q 2022
- Revenue estimate: $25.08 billion compared to $22.77 billion in 2Q 2022
Morgan Stanley (NYSE:MS):
- EPS estimate: $1.40 compared to $1.44 in 2Q 2022
- Revenue estimate: $13.45 billion compared to $13.40 billion in 2Q 2022
Goldman Sachs (NYSE:GS):
- EPS estimate: $7.64 compared to $7.73 in 2Q 2022
- Revenue estimate: $11.37 billion compared to $10.69 billion in 2Q 2022
Contact the author at emily.jarvie@proactiveinvestors.com
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