Skip to Content

Truist Financial Corp TFC

Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
Is it the right time to buy or sell?
Find out with Morningstar Premium
Is it the right time to buy or sell?
Find out with Morningstar Premium

1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Solid Quarter for Truist as Strong Fee Growth Shines

Eric Compton, CFA Senior Equity Analyst

Analyst Note

| Eric Compton, CFA |

Narrow-moat-rated Truist Financial reported solid second-quarter results, beating FactSet consensus EPS of $0.98 with reported EPS of $1.16. These results equate to a return on average tangible equity of 18.9%. Adjusted for items such as merger-related restructuring, ROTCE would have been 24.7%. While most peers have found the bottom for net interest income), Truist’s NII remains under pressure due to purchase accounting accretion, which will continue for some time. Fees had a strong performance, with adjusted noninterest income up 11% sequentially and 13% year over year, despite the second quarter of 2020 being a record quarter for the bank. Truist also released reserves of just under $600 million, which was even better than last quarter. This led to a provisioning benefit during the quarter. Expenses continue to be elevated due to merger-related items, but the bank remains on track to meet its expense-saving goals. Overall, we thought results were good for the bank, with fee income coming in strong and expenses remaining on track. After incorporating these results, we are maintaining our $61 fair value estimate.

Read Full Analysis

Company Profile

Business Description

Based in Charlotte, North Carolina, Truist is the combination of BB&T and SunTrust. Truist is a regional bank with a presence primarily in the Southeastern United States. In addition to commercial banking, retail banking, and investment banking operations, the company operates several nonbank segments, the primary one being its insurance brokerage business.

Contact
214 North Tryon Street
Charlotte, NC, 28202
T +1 336 733-2000
Sector Financial Services
Industry Banks - Regional
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 54,982

Related

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.