More From Rebecca Keats
How Would a Rate Hike Impact REITs?
If rates do rise in December, as most experts are expecting, a mass selloff in REITs will likely occur.
How Did Citigroup Stock Perform in November?
Shares of Citigroup (C) returned 9% during November. Last Monday, Citigroup’s share repurchase plans worth $1.75 billion got approval from the Fed.
Morgan Stanley’s Capital Position Remains Strong
Since the financial crisis of 2009, there has been intense pressure on US banks to raise capital levels to meet minimum requirements.
How Would Rising Charge-Offs Impact Major Banks’ Earnings?
To make the most of growing consumer spending, major banks focused on their consumer banking business. They’re lending out more consumer loans.
FIS’s Acquisition of SunGard to Become a Key Catalyst for 2016
In 4Q15, Fidelity Information Services (FIS) acquired SunGard, expanding its top line by nearly 50% and entering the capital markets and asset management businesses,
How Is BNY Mellon Controlling Expenses?
The Bank of New York Mellon’s (BK) cost-cutting program has been effective, and activist investors are appreciating the measures it’s taking to improve profitability.
After a Lackluster 2Q15, Return on Equity Will Likely Improve
Wall Street analysts expect Goldman Sachs to post return on equity (or ROE) of 11.5% in 3Q15. In 3Q14, ROE for Goldman Sachs was 11.8%.
How Would a Rate Hike Impact the Banking Sector?
The timing of a rate hike isn’t as important to banks as the quantum and pace of subsequent hikes. If rates are hiked more than expectations, earnings grow and forecasts are raised, leading to a rally in banking stocks.
Investors and Large-Cap Banks as Global Uncertainties Continue
Small-cap companies have lost only 0.4% YTD but have gained 5.3% as of November 6, month-over-month. But investors have stayed invested in large-cap banks.
Why 80% of Analysts Rate Bank of America a ‘Buy’
Wall Street analysts have been bullish on shares of Bank of America (BAC) on prospects of an interest rate hike and cheap valuations.
GS Cuts More Jobs than It Did during the 2008 Financial Crisis
Goldman Sachs has been cutting costs in recent quarters. In 2016, 2,600 people may have lost their jobs at GS—the highest number since the financial crisis.
Will Bank of America’s 4Q16 Earnings Buoy Its Stock Further?
Bank of America is expected to announce its 4Q16 results before the market opens on January 13, 2017. Analysts expect it to post earnings per share of $0.38.
5 Big Banks to Report Their Earnings this Week
This week, five of the top six commercial and investment banks will report their quarterly earnings.
Why Analysts Have a Negative Outlook for Wells Fargo in 2017
In September, Wells Fargo was slapped with the largest fine ever by the CFPB (Consumer Financial Protection Bureau), making it tough for the company to rebuild its image.
How Global Weakness Drags down Wells Fargo’s Profitability in 4Q15
Two key elements gripping the US banking sector and Wells Fargo include the near-zero interest rate and global uncertainty, which have dampened earnings.
Factors That Will Drive Goldman Sachs’ Earnings in 2016
Goldman Sachs derives 16% of its revenues from the investing and lending business. So far, 2016 has been a rough year for the financial sector.
Did Banks’ Earnings Grow in 4Q15?
The Federal Deposit Insurance Corporation’s quarterly report on the health of the US banking industry said that 4Q15 bank earnings rose 11.9% year-over-year.
Investors Added $247 Million to the Insurance ETF KIE in 2015
The SPDR S&P Insurance ETF (KIE) has added $257 million in assets in 2015 so far. In comparison, during the previous year, the fund witnessed outflows of $139 million.
Why Wells Fargo’s Energy Loan Losses Could Rise in 2Q16
At Wells Fargo’s investor day presentation, chief financial officer John Shrewsberry warned investors of more losses on energy-related loans.
Fund Flows to XLF Have Been Declining
Exchange-traded fund investors added almost $552.6 million on average to the Financial Select Sector SPDR ETF (XLF) in the last quarter. During the week ending September 25, the ETF witnessed outflows of $318.3 million.
FIS’s Acquisition of SunGard to Be a Key Catalyst in 2016
In 2015, Fidelity National Information Services (FIS) acquired SunGard, expanding its top line by nearly 50% and entering the capital markets and asset management businesses.
Is Citigroup’s Restructuring Exercise Benefiting the Company?
Citigroup’s CEO, Michael Corbat, continued his efforts to try to slim down the company’s operations and clean up its balance sheet in the second quarter.
Bank Stocks Rise Due to Expectations of a Rate Hike
2016 has been a rough year for the financial sector. Banks entered 2016 expecting four rounds of interest rate hikes. Things didn’t turn out in their favor.
KBE’s Inflows Reached $17 Million the Week Ended December 11
Among the 133 13F filers holding the stock, 43 funds reduced their exposure to KBE, while 21 funds sold all their holdings.
Can JPMorgan Beat Analysts Estimates in 2Q16?
In the past few quarters, JPMorgan has posted better-than-expected earnings and has topped revenue estimates.
XLF Crosses 20-day Moving Average, Turns Positive on October 23
The Financial Select Sector SPDR ETF (XLF) attracts the most attention among US financial ETFs, as 87% of the fund is composed of large-cap stocks.
How Wells Fargo Creates Value for Shareholders
Wells Fargo has consistently performed well in stress tests. This performance has let the company increase its dividends annually.
Why Analysts Are Bullish on Diversified Financial Services Stocks
286 analysts cover the 15 stocks in the diversified financial services subgroup of the Financial Select Sector SPDR ETF (XLF).
How Did Bank of America Perform in 2016?
Bank of America reported strong 4Q16 earnings, in line with its guidance. BAC’s management attributed this rise in earnings to its disciplined cost management strategy.
XLF Had Outflows of $30.9 Million
ETF investors withdrew $30.9 million from the Financial Select Sector SPDR ETF (XLF) during the week ended January 22, 2016. So far in January, the ETF has witnessed outflows of $924 million.
What Impacted Wells Fargo’s First Quarter Earnings?
Wells Fargo’s first quarter earnings surpassed expectations but fell 5% YoY (year-over-year). The net interest income increased by 6% to $11.7 billion.
Did Fiserv Manage to Beat Estimates in 1Q16?
Fiserv (FISV) reported 1Q16 adjusted EPS (earnings per share) of $1.06 on revenues of $1.3 billion.
Unum Group Joins Potentially Undervalued Insurance Firms in Rally
Unum Group is a provider of disability insurance products in the US and the UK. The stock has rallied by 5.48% year-to-date and by 6.18% in just the past month.
Understanding How Fidelity National Information Services Utilizes Capital
At the end of 2015, Fidelity National Information Services (FIS) had long-term debt of $11.5 billion, nearly double what it had one year previously.
Citigroup’s Focus on Efficiency Could Boost Its Profitability
Citigroup’s 2Q15 efficiency ratio was 56% and was 66% in 3Q14. The bank has focused on efficiency through cost controls and exiting low-return segments that led to a lower efficiency ratio.
What Do Analysts Advise for Citigroup after 2Q16 Earnings?
Wall Street analysts have been bullish on Citigroup (C) on its growth prospects and inexpensive valuations.
BNY Mellon’s Capital Ratios and Liquidity Position Improved in 4Q16
Bank of New York Mellon’s (BK) Tier 1 Capital ratio was 14.5% compared to 13.6% recorded at the end of its previous quarter.
Financials Surged Week Ended November 20 with Hints of a Rate Hike
After a strong start to 2015, banking stocks have been on a roller coaster ride as the Fed kept investors guessing about its interest rate policy.
Will FIS’s 3Q16 Earnings Meet Expectations?
Fidelity National Information Services (FIS) is slated to report its 3Q16 results on November 1. Wall Street analysts expect it to post earnings per share (or EPS) of $0.98, 8% higher year-over-year.
Do Goldman Sachs’s Valuations Look Attractive?
Goldman Sachs (GS) is trading at 8% above its book value and 18 times its one-year forward earnings.
What Investors Should Know about BlackRock’s iShares Business
BlackRock (BLK) is the largest asset management firm in the world. BlackRock generated $10.9 billion of inflows in the iShares ETF segment in 2Q15.
Will Dividends Please Wells Fargo’s Investors Worried about Scandals?
In June, the Federal Reserve approved Wells Fargo’s (WFC) capital plans after it found that the bank could keep lending in a severe economic downturn.
What Do Analysts Recommend for JPMorgan Chase and Wells Fargo?
In a Bloomberg survey of 37 analysts, 19 analysts (51%) have assigned a “buy” rating to Wells Fargo (WFC) while 13 (35%) have rated it as “hold.” The stock currently has five “sell” ratings.
Deutsche Bank Reports 3Q15 Losses of 6 Billion Euros
Deutsche Bank (DB) announced its third quarter earnings on October 29, 2015. The bank reported losses of 6 billion euros ($6.6 billion), which was in line with a warning issued earlier in October.
Why JPMorgan Chase’s Trading Revenues Beat Expectations
JPMorgan Chases’s trading and investment banking business recorded healthy growth in the second quarter.
What Do Analysts Forecast for BNY Mellon’s 4Q16 Earnings?
According to consensus data accumulated by Reuters, net revenues for BNY Mellon are expected to be $3.8 billion in 4Q16, 3.4% higher year-over-year.
How Did Bank of America Perform on 2016 Stress Tests?
Bank of America boosted its dividends by 50% to $0.075 after it cleared the Fed’s 2016 stress tests.
Genworth’s Third Quarter Earnings Miss Analysts’ Expectations
Genworth Financial (GNW) reported its third quarter earnings on October 30, 2015. The company reported operating EPS of $0.13, well below analysts’ estimates of $0.22.
Does Citigroup Look Attractive at Its Current Valuations?
Currently, Citigroup trades at a discount of 40% to its book value. It trades cheaper than peers such as JPMorgan Chase, Wells Fargo, and Goldman Sachs.
Institutional Asset Managers Liquidate Exposure to Brazil ETFs
The 13F filings of major institutional asset managers for the second quarter of 2015 offer a gloomy picture for Brazil.
Are Emerging Markets Cracking or Crashing on Greece Woes?
Chinese shares contributed significantly to the downfall of emerging market funds, as the iShares MSCI China Index ETF sank 2.84% on Monday.
Another Regulatory Hurdle for Wells Fargo as It Fails Fed’s Test
Wells Fargo fails test In another blow to Wells Fargo’s reputation, the Federal Reserve said that Wells Fargo (WFC) failed to meet the requirements of its stress tests and faces penalties. The bank (XLF) failed the “living will” test that requires banks with above $50 billion in consolidated assets to submit a resolution plan explaining […]
Has Bank of America Stock Lost Steam?
So far in 2016, Bank of America stock has risen 37.0%. By comparison, shares of Goldman Sachs (GS), Citigroup (C), and Wells Fargo (WFC) have underperformed.
JPMorgan Chase Gained 4% after Its 1Q16 Earnings: Was It That Good?
On April 13, JPMorgan Chase reported 1Q16 earnings of $1.35 per share. It beat consensus estimates of $1.28. Its shares rallied 4.2% after the earnings beat.
The Banking Sector in Mid-November: Awaiting a Probable Rate Hike
The Fed’s focus in December will likely be on the pacing of subsequent rate hikes rather than on the timing of the first rate hike.
Banks Surge to Highest Levels since Financial Crisis
Some investors are still expecting banks to reap huge benefits from rising interest rates in 2017 and lighter regulations under Trump’s administration.
Did the Fed Really Hint About a Negative Interest Rate?
A negative interest rate policy (or NIRP) may still be a far-fetched idea in the United States, but the Federal Reserve wants banks to prepare for it.
KIE Crossed over Its Moving Averages on November 16, Trending Up
On November 23, shares of KIE closed at $72.38, above its 100-day, 50-day, and 20-day moving averages of $70.07, $70.06, and $71.73, respectively.
XLF May Cross Its 100-Day Moving Average: Is It Time to Buy?
The Financial Select Sector SPDR ETF (XLF) attracts the most attention among financial ETFs in the US. 87% of the fund is composed of large-cap stocks.
Banks That Look Riskier in the Brexit Aftermath
Banks with significant exposure to the United Kingdom and the European Union are the riskiest investments in a post-Brexit environment.
How Markets Will Be Driven by Central Banks’ Actions in December
December is extremely critical for investors in stock markets around the world. Central banks of the two largest economies in the world are expected to make key monetary policy decisions.
Ventas Completes Spin-Off of Care Capital Properties
Ventas’s spin-off Care Capital Properties (CCP) will issue 84 million shares ($30 to $34 per share) and expects to raise around $2.7 billion.
The Financial Markets in Latin America: An Overview
The Dow Jones Latin America Financials Index (DWLAFN) has plunged 20.03% year-to-date. This poor performance is largely due to Brazilian Financials.
Morgan Stanley’s Expense Cuts Are Key Part of Recovery
Morgan Stanley’s 2Q16 earnings beat analysts’ estimates, as the bank reported considerably lower legal expenses.
Bank of America’s Credit Default Risks Could Be Rising
Bank of America (BAC) has a credit card loan portfolio worth $96.4 billion as of March 31, 2016. It accounts for 22% of its total consumer loans.
Financial ETF XLF Traded below Its Moving Averages on December 11
This series analyzes investors’ sentiments toward the financial sector in the major global regions: the United States, Europe, China, Japan, and the Emerging Market economies.
EUFN Is Trending Downwards on Global Growth Worries
The iShares MSCI Europe Financial Sector ETF (EUFN) seeks to track the performance of an index composed of developed market European (FEZ) equities in the financials sector.
Why Latin American Economies May Be in Trouble
Worsening economic conditions in Brazil and Venezuela hit economic growth in Latin America in the first quarter of 2015.
DXJF Crosses below Its 20-day Moving Average on October 30
DXJF is the only ETF to provide exposure to Japanese financial stocks. Trading activity in the DXJF fund has been scarce, with only a few thousand shares trading hands each day.
Why Are Deutsche Bank Investors So Concerned About AT1 Coupons?
Shares of Deutsche Bank (DB) have fallen nearly 10% in the last three trading sessions. Efforts to reassure investors about its ability to pay coupons on its AT1 bonds were in vain.
Inside FIS’s Integrated Financial Solutions Segment
FIS’s Integrated Financial Solutions segment caters to North American banks and is the largest contributor to the company’s total revenues (~60%).
Why Deutsche Bank Prefers Bank of America over J.P. Morgan
In this series, we’ll compare Bank of America and J.P. Morgan on the basis of their 2Q earnings, profitability, cost-cutting initiatives, and interest rate sensitivities.
How Does Wells Fargo Compare on Energy Exposure?
Wells Fargo (WFC) seems secure when it comes to risks arising from energy-related loans. Wells Fargo’s energy loan portfolio of $17.8 billion made up 1.7% of the total loan portfolio in 1Q16.
Why Analysts Think Bank of America Is a Better Bet Than JPMorgan
Financial stocks have been rising after a better-than-expected 2Q16. Despite this, Citigroup has downgraded JPMorgan Chase to a “neutral” from a “buy.”
The KRE ETF Is Trending Downward since December 28
The SPDR S&P Regional Banking ETF (KRE) targets US regional banks. It seeks to track the performance of the S&P Regional Banks Select Industry Index.
The Details of Citigroup’s Deal with China Guangfa Bank
Citigroup (C) purchased its holding in China Guangfa Bank in 2006 as part of a consortium of investors. The consortium purchased an 85.6% stake for 24.27 billion yuan, or $3.1 billion then.
DXJF Is in a Bearish Trend
On December 11, 2015, DXJF closed at $25.57. This was below its 100-day, 50-day, and 20-day moving averages of $27.71, $27.39, and $27.47, respectively.
Stock Price Performance of US Banks in 2015
The Great Recession is officially over for financial institutions. Since stocks bottomed out in early 2009, the financial sector has been one of the best performing sectors in the market.
Banks Relying Heavily on Interest-Related Income Suffered
In the third quarter, banks that relied heavily on interest-based income suffered, reporting record-low net interest margins.
Why Did Morgan Stanley Upgrade Citigroup?
Last week, Morgan Stanley (MS) analyst Betsy Graseck upgraded Citigroup from “equal-weight” to “overweight” and upgraded her target price from $50 to $70.
Citigroup’s Profitability Boosted by Lower Expenses
In terms of profitability, Citigroup’s return on equity (ROE) fell to 8.0% from 9.1% in the previous quarter but rose sharply from the 5.3% reported in 3Q14. Return on assets fell to 0.9% from 1.1% in 2Q15.
XLF Is above Its 20-Day Moving Average: Is This a Bullish Sign?
On February 19, the Financial Select Sector SPDR ETF (XLF) closed at $20.98. This is 10% and 6% below its 100-day and 50-day moving averages, respectively.
Understanding Goldman Sachs’s Segmental Earnings
Goldman Sachs ranked first in worldwide announced and completed mergers and acquisitions so far in 2015.
Bulls and Bears Make Money, But Do PIIGS or PIIS Get Slaughtered?
The troubled PIIGS countries—Portugal, Italy, Ireland, Greece, and Spain—have been suffering from financial sustainability concerns about large fiscal deficits and stagnated growth.
What Are Analysts Saying about Bank of America?
Bank of America has had a great November thanks to Trump’s presidential victory, but this has also led to several downgrades for the stock.
Assessing XLF’s YTD Outflows as of February 12
In 2016 so far, ETF investors have withdrawn $2.1 billion from XLF and pulled out funds worth $857 million from XLF during the week ending February 12.
Japanese Financial ETF DXJF Is in a Bearish Trend in 2016
The WisdomTree Japan Hedged Financials (DXJF) seeks to provide exposure to the Japanese financial sector.
REITs Are Overvalued on a Price-to-Book Basis
REITs are the most overvalued sector in XLF on a price-to-book multiple basis. On average, REITs traded at a price-to-book multiple of 3.57x as of Monday, July 6.
KRE Traded above Its Moving Averages, Led Financial Sector ETFs
KRE seeks to track the performance of the S&P Regional Banks Select Industry Index,
particularly targets regional banks in the US. Shares of KRE have gained 11.4% YTD.
An Introduction to Brazil’s Largest Banks, Latin America’s Biggest
Since the ’80s and ’90s, Latin American banks have stabilized. Today, the largest banks in Latin America are concentrated in two countries: Brazil and Mexico.
Interest Rate Hikes Will Drive Bank of America’s Margins in 2017
Bank of America’s (BAC) earnings are extremely sensitive to interest rate changes. Low interest rates weighed on the bank’s top line in 2016.
Bank of America and Wells Fargo: Comparing Interest Rate Exposure
Since Donald Trump’s presidential victory, Wall Street analysts have raised their forecasts for the major banks’ (XLF) net interest margins as they anticipate rising interest rates and economic growth.
What Do Analysts Forecast for Bank of America’s 4Q16 Earnings?
Investors on Wall Street (SPY) are eagerly awaiting the earnings of the financial sector (XLF), which serve as a barometer for economic health.
Is Bank of America’s Rally Over?
In 2016 so far, Bank of America stock has risen 21%.
US Banks Witness the Highest Loan Growth since the Recession
Total loans and leases in bank credit grew at a seasonally annualized rate of 8.1% over 1Q15. Loan growth was 5.6% the previous quarter and 5.3% for 1Q14.
What Drove Fiserv’s 4Q16 Earnings Growth?
Fiserv’s 4Q16 net income of $215 million was 14% higher YoY.
Wells Fargo’s Loan Growth Outpaces Bank of America and Peers
Wells Fargo (WFC) has the largest loan portfolio in the financial sector (XLF), anchored by its mortgage portfolio.
A Look at IYF’s Outflows So Far in 2016
The iShares US Financials ETF (IYF) recorded net outflows of $847 million in 2015. As of March 24, 2016, investors have withdrawn $360.6 million from IYF.
How Did FIS’s Earnings Stack Up in 1Q16?
Fidelity National Information Services (FIS) posted earnings of $0.79 per share for 1Q16, 22% higher than the same period last year. Revenues grew by 4.2% year-over-year to $2.2 billion.
The Banks in XLF: All Posted Negative Returns
All 21 banks in XLF posted negative returns during the week ended January 22, 2016. Fifth Third Bancorp (FITB), Bank of America (BAC), and Citigroup (C) were the worst performers.