| 2021-01-14 14:17:48|
JPM, C… 14:17 01/14 01/14/21
Fly Intel: What to watch in first round of big bank earnings reports
JPMorgan (JPM), Citigroup (C) and Wells Fargo (WFC) are scheduled to announce quarterly results before the open on January 15. What to watch for: 1. OUTLOOK: During the company's last earnings call, JPMorgan said it still sees fiscal year 2020 net interest income about $55.5B, market dependent, and fiscal year 2020 adjusted expense of about $66B. For fiscal year 2021, JPMorgan said it sees net interest income at $53B. Meanwhile, Citi said it sees fiscal year 2020 revenue roughly flat year-over-year, expenses growth of roughly 2% and investment banking revenue down in the low double digits. For fiscal year 2021, the bank sees net interest revenue down year-over-year. 2. TARGETS UPPED AHEAD OF EARNINGS: Earlier this week, Piper Sandler analyst Jeffery Harte raised the firm's price target on JPMorgan and Citi to $150 from $118 and to $85 from $68, respectively. The analyst kept Overweight ratings on both names. Harte also increased fourth quarter earnings estimates for the universal and trust banks to primarily reflect a "strong finish" for capital markets activity levels. Further, he sees "more room to run" for shares after the recent rally. 3. OUTSIZED EARNINGS BENEFITS: On Monday, UBS analyst Saul Martinez upgraded Wells Fargo to Buy from Neutral. The analyst said that the company continues to be a "sizable multiyear underperformer," though the company's weaknesses could turn into investment positives. Martinez believes that even modest improvements in efficiency and slight reductions to loan loss revenues can yield outsized earnings benefits. 4. HEALTHCARE JV TO DISBAND: Haven, the healthcare joint venture formed by Amazon (AMZN), Berkshire Hathaway (BRK.A) and JPMorgan Chase, is disbanding after three years, CNBC's Hugh Son recently reported, citing people with direct knowledge of the matter. The venture will shut down by the end of next month and many of its 57 employees are expected to be placed at Amazon, Berkshire or JPMorgan as the companies individually proceed in their efforts. The three firms will still collaborate informally on healthcare.