Welcome back to Money Movers. Take a look at shares of Wells Fargo down more than 5% despite reporting a beat on the top and bottom lines and notching their first revenue beat in a year. The company did cut its fullear net interest income guidance.Joining us here straight off the earnings call and first on CNBC, Wells Fargo CFO Michael Santaimo. Mike, it's great to have you back on it. It is that NII miss and lowered guidance which caught the street off guard.Can you just explain why that happened. mind is ...

Wells Fargo Shares Slide on NII Miss, Forecast Cut. Get caught up on the day's gainers and decliners on the latest Stock Movers report https://t.co/IXvZTM0vCi ...

Industry Overview - The Zacks Consumer Loans industry includes companies providing various loan products such as mortgages, credit card loans, and personal loans, which are crucial for generating net interest income (NII) [3] - The industry's performance is highly sensitive to the overall economic conditions and consumer sentiments, with many providers also engaging in commercial lending and asset recovery to diversify revenue sources [3] Key Influencing Factors - **Asset Quality**: Prolonged high interest rates are affecting borrowers' repayment capacity, leading to increased reserves by loan providers to mitigate rising defaults, which is deteriorating asset quality [4] - **Interest Rates & Loan Demand**: Steady interest rates have slightly improved loan demand, but consumer confidence remains low due to tariff-related uncertainties, limiting growth in net interest margin (NIM) and NII [5] - **Lending Standards**: Improved credit scores due to the removal of tax liens from credit reports have expanded the borrower pool, while relaxed lending standards are helping meet loan demand [6] Industry Performance - The Zacks Consumer Loans industry has a Zacks Industry Rank of 155, placing it in the bottom 37% of over 250 Zacks industries, indicating underperformance in the near term [7][8] - Analysts have revised the industry's earnings estimates for the current year down by 7.9%, reflecting a loss of confidence in earnings growth potential [9] Market Comparison - Over the past two years, the Zacks Consumer Loans industry has outperformed the Zacks S&P 500 composite and the Zacks Finance sector, with a collective stock increase of 68.3% compared to 39.5% and 42% respectively [11] Valuation Metrics - The industry has a trailing 12-month price-to-tangible book ratio (P/TBV) of 1.33X, above the five-year median of 1.03X, but significantly lower than the S&P 500's ratio of 13.33X [14][16] Investment Opportunities - **Capital One Financial Corporation (COF)**: Focused on consumer and commercial lending, COF is well-positioned for growth with a market cap of $141.3 billion and expected earnings growth of 10.7% and 20% for 2025 and 2026 respectively [21][20] - **Enova International, Inc. (ENVA)**: A financial technology company with a market cap of $2.94 billion, ENVA has seen a 20.7% increase in shares this year and is expected to grow earnings by 28.9% and 17.6% in 2025 and 2026 respectively [26][25]

Core Viewpoint - Huntington Bancshares Incorporated (HBAN) is expected to report an increase in quarterly revenues and earnings year over year for the second quarter of 2025, with earnings anticipated to be stable compared to the previous quarter [1][3]. Financial Performance - The bank recorded an earnings surprise of 9.7% in the last reported quarter, driven by improvements in fee income and net interest income (NII), although non-interest expenses increased [1][2]. - Preliminary results indicate earnings of 34 cents per share, reflecting a 13.3% rise from the year-ago figure, despite a 2.9% decline in the Zacks Consensus Estimate over the past week [3][10]. - Revenues for the quarter are projected to be $1.95 billion, slightly below the consensus estimate of $1.99 billion, but still representing a year-over-year increase of 9.6% [4][10]. Key Factors Influencing Performance - NII is expected to grow to $1.5 billion, a 3% increase from the prior quarter, supported by steady loan demand and interest rates remaining unchanged by the Federal Reserve [5][10]. - The average total earnings assets are estimated to rise by 1.5% to $191.1 billion, reflecting strong demand for commercial and industrial loans [6]. - Mortgage banking income is projected to increase by 9.5% to $34 million, aided by stable refinancing activities despite fluctuating mortgage rates [7][8]. Non-Interest Income and Expenses - Total non-interest income is expected to decline by 5.4% to $520.6 million, influenced by rising expenses and credit loss reserves [10][12]. - Higher expenses are anticipated due to increased costs from data processing, marketing, and expansion efforts in commercial banking [13][14]. Asset Quality - The bank has increased its allowance for credit losses by $37 million to $2.5 billion, reflecting concerns over potential delinquent loans amid economic uncertainties [14]. - The Zacks Consensus Estimate for total non-accrual loans indicates a 3.5% increase from the prior quarter, suggesting a cautious approach to asset quality [15]. Earnings Expectations - The chances of HBAN beating earnings estimates are considered low due to a negative Earnings ESP of -2.42% [16]. - The company currently holds a Zacks Rank of 2 (Buy), indicating a favorable outlook compared to other stocks [17].

Wells Fargo lowers its full-year guidance for net interest income, after another quarter of tepid growth amid the ongoing trade war https://t.co/86eFv0x2pN ...

Market Trends & Outlook - US lenders are forecasted to show increases in trading revenue, which is a key focus this earnings season [1] - Net interest income is expected to accelerate in the second half of the year, offsetting seasonal declines in trading [2] - The environment has improved significantly since April, with recession odds for 2025 dropping from 65-70% to around 20%, and expectations shifting from close to four rate cuts to two [4] - Banks' guidance is expected to be stable or with a bias to the upside, as they were conservative in their adjustments a few months ago due to volatility [5] Investment Banking Performance - Investment banking results are expected to underperform, marking the 14th consecutive quarter where they contribute less than a quarter of industry revenues [7] - A typical global investment banking revenue pool consists of approximately 50% FICC (Fixed Income, Currencies, and Commodities), 25% equities trading, and 25% banking fees [8] - There is potential for improvement in equity fees and equity underwriting, especially with global equities indices hitting record highs [10] - While equity fees may improve, it will be tough to hit the high watermark seen a couple of years ago [10] Strategic Focus - Investors are focusing on the profitability of investment banking, as it is a capital-light business, rather than just revenue [9]

I was just referring to the VIX a short time ago with our guest. Um during this quarter, the VIX spiked up to above 50. Now it's kind of settled down to 171 18.Are there any banks that are going to benefit specifically from some of that volatility earlier in the quarter like we saw last quarter where banks said they saw higher trading volume and they kind of benefited from the idea that investors weren't quite sure what to do. Sure. And thanks again for having me.We've noticed um and looking forward to this ...

Core Viewpoint - JPMorgan is set to report its Q2 2025 earnings on July 15, with expectations of modest performance compared to previous quarters, influenced by various market factors and economic conditions [1][2]. Financial Performance - JPMorgan's Q1 performance was strong, driven by investment banking and trading, alongside growth in credit card and wholesale loans [2]. - The Zacks Consensus Estimate for Q2 revenues is $43.47 billion, indicating a 3.4% year-over-year decline [2]. - The consensus estimate for earnings per share (EPS) has been revised slightly upward to $4.49, reflecting a 2.1% increase from the prior year [3]. Estimate Revision Trend - The earnings estimates for the current quarter and the next have seen minor upward revisions, with current estimates at $4.49 for Q2 2025 and $4.47 for Q3 2025 [5]. - The average earnings surprise over the last four quarters has been 10.70%, with the company consistently outperforming estimates [5][7]. Factors Influencing Q2 Performance - Net Interest Income (NII) is expected to rise by 3% year-over-year, supported by stable funding costs [8]. - Investment Banking (IB) fees are projected to decline by 11.4% year-over-year, with a consensus estimate of $2.18 billion [12]. - Markets revenues are anticipated to grow in the mid-to-high single digits, with estimates for equity markets revenues at $3.15 billion and fixed-income markets revenues at $5.25 billion [14]. Asset Quality and Expenses - Non-performing loans (NPLs) are expected to increase by 17.3% year-over-year, with estimates at $9.14 billion [18]. - Non-interest expenses are projected to remain stable at $23.7 billion, influenced by expansion efforts and technology investments [16][17]. Market Position and Valuation - JPMorgan shares have outperformed the S&P 500 but lagged behind peers like Citigroup and Bank of America [21]. - The stock is currently trading at a forward P/E of 14.78X, which is below the industry average of 14.9X [22]. - The acquisition of First Republic Bank in 2023 is expected to bolster financials and support long-term growth [26]. Strategic Outlook - The company is focusing on expanding its footprint and capitalizing on cross-selling opportunities, despite facing challenges in fee income growth due to market volatility [28]. - Investors are advised to monitor management's comments on NII and IB business prospects during the upcoming earnings call [29].

Core Viewpoint - Citigroup Inc. shares reached a new 52-week high of $88.82, closing at $87.60, with a 35.3% increase over the past year, compared to the industry's 41.2% growth [1][9] Financial Performance - Citigroup passed the Federal Reserve's 2025 stress test, indicating strong capital to absorb significant losses [4] - The company plans to increase its quarterly dividend by 7% to 60 cents per share starting in Q3 2025, pending board approval [5] - Citigroup's current dividend yield is 2.56%, higher than Wells Fargo's 1.94% and Bank of America's 2.14% [6] Capital Management - Citigroup has a $20 billion stock repurchase program, with $1.75 billion in shares bought back in Q1 2025 and a similar target for Q2 [7] - As of March 31, 2025, Citigroup's cash and investments totaled $761 billion, with total debt at $317.5 billion, indicating a strong liquidity position [8] Business Restructuring - The company is simplifying its governance structure, reducing management layers from 13 to eight, and has announced plans to eliminate 20,000 jobs over two years, saving $2-2.5 billion annually by 2026 [10][11] - Citigroup is exiting consumer banking operations in 14 markets, having successfully exited in nine countries, which is expected to free up capital for higher-return segments [12][16] Revenue Growth - Citigroup's net interest income (NII) has a CAGR of 8.4% from 2020 to 2024, with expectations of a 2-3% increase in 2025 [16][17] - The company is expanding its presence in private credit through partnerships, including a $25 billion direct lending initiative with Apollo Global Management [18][19] Estimates and Valuation - Consensus estimates suggest a 3.5% and 3.2% increase in sales for 2025 and 2026, respectively, with earnings expected to rise by 23.2% and 27.6% [20] - Citigroup's current P/E ratio is 10.46x, lower than the industry average of 15.06x, indicating a potentially undervalued stock [22][25] Strategic Outlook - Citigroup's strong capital levels, operational efficiency improvements, and strategic exits position it for long-term growth, despite rising expenses and a complex overhaul plan [26][27]

Group 1 - Bank of America is expected to report earnings on July 16, 2025, with revenues projected at approximately $26.77 billion, reflecting a 5.5% year-over-year increase, and earnings per share anticipated to be around $0.87, up from $0.83 in the same period last year [2] - The bank may see an increase in net interest income due to reduced deposit costs and higher yielding assets, but the investment banking sector is likely to negatively impact overall performance, with a potential revenue decline of up to 25% in Q2 due to slowed deal activity from policy uncertainties [2] - Bank of America currently has a market capitalization of $374 billion and reported a net income of $28 billion over the past twelve months, despite an operational loss [3] Group 2 - Historical data indicates that Bank of America has recorded 20 earnings data points over the last five years, with positive one-day returns occurring approximately 60% of the time, increasing to 75% when considering the last three years [5] - The median of the 12 positive one-day returns is 2.9%, while the median of the 8 negative returns is -2.6% [5] - Correlation data shows the relationship between one-day post-earnings returns and subsequent five-day returns, which can inform trading strategies [6]