The Week Ahead: Banks Kick Off Earnings Season
Against a mostly positive backdrop for banks, Citi, JP Morgan, Wells Fargo, and PNC will report this week.
Jeremy Glaser: Third-quarter earnings season kicks off this week. Friday brings a number of big bank reports including Citi, JP Morgan, Wells Fargo, and PNC. Our analysts generally see a positive landscape for banks at the moment given the reduction in tax rates and generally solid economic growth.
Through the year, they are looking at four big trends in the sector. First, the potential for higher loan growth; second, a push for more cost savings; third, a reduction in regulatory spending; and finally, that the benefit higher short-term rates will be offset partially by higher yields paid to clients. Much of the positive news looks baked into stock prices, but analyst Eric Compton does see value in Wells as he thinks the market is still too pessimistic on the firm's prospects.
No-moat Walgreens Boot Alliance will also report next week.
In economic data, the consumer price index and the University of Michigan consumer sentiment gauge are on tap.
Stay tuned for our take on these stories.
Jeremy Glaser does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.