PNC Financial Services Group Inc
How Does BlackRock Make Money?
BlackRock, an investment management giant, had $7.0 trillion in AUM (assets under management) at the end of the third quarter.
Which FAANG Stock Will Sit on the Iron Throne?
With earnings around the corner, which FAANG stock will perform the best?
Berkshire Hathaway’s Banking Holdings in Q1
Among Berkshire Hathaway’s financial holdings, JPMorgan Chase was the worst performer, while Goldman Sachs was the top performer.
Did Buffett Miss the Bus on Apple?
Berkshire Hathaway (BRK-B) is Apple’s second-largest shareholder.
Why Warren Buffett’s Market Views Differ from President Trump
While Buffett didn’t find compelling investment opportunities in the fourth quarter, President Trump called it a “bottom” in December.
Buffett’s Love for Banking Stocks Continued in Q4
Berkshire Hathaway is the largest shareholder in Wells Fargo (WFC), Bank of America (BAC), U.S. Bancorp (USB), and American Express (AXP).
Analyzing Berkshire Hathaway’s Recent Portfolio Additions
Oracle is the latest tech company that Buffett added in the fourth quarter. Previously, Buffett added and completely exited IBM.
Key Changes in Berkshire Hathaway’s Holdings in Q3
Looking at Berkshire Hathaway’s third-quarter 13F, the company added more Apple shares and added a new position in JPMorgan Chase.
What Analysts Are Saying about TD Ameritrade
TD Ameritrade Holding (AMTD) is tracked by 19 analysts in March 2018. Eight of them are suggesting a “hold” for the stock.
Analyzing TD Ameritrade’s Premium Valuations
The PE ratio of TD Ameritrade Holding (AMTD) was 17.14x on an NTM (next-12-month) basis, which represents a premium valuation.
TD Ameritrade Converted Scottrade Brokerage Accounts
TD Ameritrade Holding (AMTD) announced on February 28, 2018, that it has converted the brokerage accounts of Scottrade.
What Analysts Are Recommending for State Street Today
Of the 20 analysts tracking State Street (STT) in January 2018, none has recommended a “strong sell” or a “sell.”
Can State Street Recover from Discounted Valuations?
State Street’s (STT) PE (price-to-earnings) ratio stood at 14.6x on an NTM (next-12-month) basis, compared with the peer average of 17x.
Understanding State Street’s Balance Sheet
State Street’s (STT) total assets stood at $238.4 billion at the end of 4Q17, compared with $242.6 billion in 4Q16.
Behind State Street’s Assets under Custody and Administration in 4Q17
State Street’s (STT) total AUCA (assets under custody and administration) as of December 31, 2017, stood at $33.11 trillion.
What’s Driving PNC Financial Services?
The PNC Financial Services Group’s (PNC) revenue net of interest expense remained flat in 2016 and grew 8% in 2017.
ETFs Start 2018 on a Very Strong Note
ETFs started 2018 on a very promising note. According to FactSet, the total ETF inflows amounted to $5.32 billion for the first week of the year.
What Analysts Recommend for Invesco
In December 2017, six of the 16 analysts tracking Invesco (IVZ) gave it a “strong buy” rating, five have rated it a “buy,” and five are suggesting a “hold.”
What Analysts Expect from Invesco’s 4Q17 Revenues
Invesco (IVZ) garnered total performance fees of $70.3 million in the first three quarters of 2017 versus $26.8 million in the same period of the prior year, an increase of $43.5 million.
How Invesco’s Assets under Management Are Moving in 2017
In 9M17, Invesco Limited (IVZ) posted total assets under management (or AUM) of $917.5 billion.
Invesco’s Total Operating Revenues Rose Marginally
Invesco (IVZ) generated total operating revenues of $3.7 billion in the first nine months of 2017.
Breaking Down Invesco’s Assets under Management in 3Q17
Invesco Limited (IVZ) garners its total assets under management (or AUM) from two channels: retail and institutional.
Invesco’s Assets under Management Rose in 3Q17
Invesco Limited (IVZ) reported total assets under management (or AUM) of $917.5 billion on September 30, 2017.
What’s behind the Rise in Invesco’s Total Operating Expenses?
Invesco has seen a YoY rise in employee compensation expenses from $345.1 million in 3Q16 to $393.1 million in 3Q17.
Invesco’s Strong 3Q17 Results Beat Estimates
Invesco (IVZ), an investment management company, reported earnings per share (or EPS) of $0.71 in 3Q17, higher than Wall Street analyst predictions of $0.66.
What Analysts Suggest for Carlyle Group after 3Q17 Results
The Carlyle Group (CG) is being tracked by 12 analysts in November 2017. Five of them have rated the stock a “hold,” and four have given it a “strong buy.”
Factors That Led to a Decline in Discover’s Net Income in 1H17
Discover Financial’s employee compensation expenses rose 7% in 1H17 compared to 1H16.
Discover Misses Earnings Estimates but Beats Revenue Estimates
Discover Financial Services (DFS) posted earnings per share of $1.40 in 2Q17, which missed the analysts’ estimate of $1.45. DFS reported revenues of $2.42 billion in 2Q17, beating the analysts’ estimate of $2.40 billion.
PNC Financial Expands Its Loan Book on Commercial Lending in 4Q16
In 4Q16, PNC Financial expanded its average commercial lending by 1% (or $1.7 billion) quarter-over-quarter to $138.1 billion.
PNC Shows Strength in 4Q16 on Interest Income, BlackRock
PNC Financial Services (PNC) reported its 4Q16 earnings on January 13, 2017. The company reported earnings per share (or EPS) of $1.97.
PNC’s Payout Ratio Is Expected to Be High in 2017
PNC Financial Services (PNC) is expanding its balance sheet on the back of new assets and expanding offerings.
PNC Commands Premium Valuations on Rates, BlackRock
PNC Financial Services (PNC) manages both diversified banking operations and financial services divisions.
BlackRock Is Benefiting PNC Financial’s Non-Interest Income
PNC Financial’s non-interest income for 3Q16 rose $167 billion compared to 3Q15. Sequentially, the company’s income rose $8 million.
Why PNC Financial Is Expected to Expand Its Loan Book in 4Q16
PNC Financial Services (PNC) engages in corporate, retail, and institutional banking. The diversified giant expanded its commercial lending to $138 billion in 3Q16.
PNC Financials’ Non-Interest Income Ratio Continues to Expand
PNC Financial’s non-interest income for 2Q16 increased by 10% over the previous quarter, mainly due to higher fee income growth.
PNC Financial Services Expands Commercial Lending
PNC Financial Services expanded its commercial lending in the first quarter of 2015.
PNC Financial Services: What Impacted Its 2Q16 Earnings?
PNC Financial Services (PNC) reported its 2Q16 earnings on July 15, 2016, and managed to beat analysts’ estimates.
What Can We Expect from PNC Financial Services in 2Q16?
PNC Financial Services (PNC) is expected to report EPS (earnings per share) of $1.76 in the June quarter and $7.16 for fiscal 2016.
PNC’s Non-Interest Income Expands on Asset Management
PNC Financial’s non-interest income for 4Q15 increased by 3% compared to the previous quarter, mainly due to higher fee income growth.
PNC Financial Beats 4Q15 Estimates on Lower Expenses
PNC Financial (PNC) reported its 4Q15 earnings on January 15, 2016, and managed to beat analysts’ estimates. It reported $1.87 per diluted common share, while analysts had estimated $1.80.
We Have Liftoff: Federal Reserve Hikes the Federal Funds Rate
On December 16, 2015, the Federal Open Market Committee unanimously decided to hike the federal funds rate by 25 basis points to 0.25–0.50%.
Rate Hike Expectations Propelled Financial Stocks Higher
Many banks and financial service providers’ stocks rose on December 15. US investors picked the stocks with the expectation of the zero interest rate policy.
The Big Picture in US Equity Mutual Funds: November Rundown as of October
Investors need to keep a close watch on signs that indicate a “liftoff” in December and should be ready to rebalance their equity mutual funds accordingly.
Evaluating Regional Banks’ Performance versus the Financial Sector in 2015
Within XLF, banking stocks have returned -5.3% YTD as of November 13, while regional banks have returned -1.6% YTD, outperforming the financial sector.
Why Are Market Participants Concerned about December 2015?
The addition of “at its next meeting” in the FOMC’s October statement has led market participants to believe that a rate hike may be effected in its December meeting.
What Bond Yields and Indices Are Telling Investors
Yields, as measured by the BofA Merrill Lynch US High Yield Master II Effective Yield, have been 6%–8.2% YTD in 2015. The yields rose since May 2015.
Investment-Grade Bond Funds Witnessed Inflows for the Third Week
The flows into investment-grade bond funds were positive for the week ending October 28. This was the third consecutive week of inflows.
Microsoft Led the High-Grade Bond Issuance Last Week
US corporates were the biggest issuers of high-grade bonds in the week ending October 30. They accounted for 67.1%, or $25.7 billion, of all the issues.
Why Did Investment-Grade Corporate Bonds’ Issuance Rise?
There were investment-grade corporate bonds worth $38.2 billion issued in the primary market in the week ending October 30—the highest since September 18.
Assessing Market Regulations: Headed for a Liquidity Crunch?
Some market participants point out that regulations give cause for worry about bond market liquidity because they hinder banks’ market-making capabilities.
The US Monetary Policy: Fischer and Brainard Speak Out
With regard to US monetary policy, there’s been a lot of emphasis on the timing of the first increase in the federal funds rate. The path of the funds rate is more important than the first increase.
Analyzing Commercial and Industrial Loan Growth
After peaking in 1Q15, commercial and industrial growth slowed down in April and May. The growth was 10.4% in April and 9.5% in May 2015.
Bank Deposits Grow by 5.4% in First Week of June
June 12 data from the Fed According to the latest Federal Reserve data released on June 12, total deposits at all US commercial banks in the week ending June 5 increased by 5.4% YoY (year-over-year). Deposits grew by 5.6% YoY in the previous week. Total deposits account for 85% of US banks’ funding. As the above graph shows, […]
June Surge in Mortgage Applications Should Benefit Banks
The MBA’s survey is based on applications for residential mortgages. It covers more than 75% of all US retail residential mortgage applications.
Week Ending May 27 Sees Outflows in Investment-Grade Bond Funds
Flows into investment-grade (LQD) bond funds ventured into negative territory for the week ended May 27.
Investment-Grade Corporates Take Issuances Down a Notch
Investment-grade corporate bonds worth $25.45 billion were issued in the primary market in the week to May 29, 2015.
Private Student Loans at Banks Rise with Stricter Underwriting
The US student loan market is mainly dominated by public loans. Private student loans account for less than 8% of the total student loan market.
Why PNC Financial Has Been Pricing at a Premium
PNC Financial (PNC) successfully diversified its banking operations by extending offerings in asset management, consumer services, and investment banking.
PNC Returned Capital through Stock Repurchases and Dividend
In 1Q15, PNC Financial bought back 4.4 million common shares worth $0.4 billion. The purchase was part of its four-quarter repurchase program.
PNC Financial Reports Strong First Quarter Results
PNC Financial Services Group (PNC) reported its first quarter earnings for financial year 2015. It just managed to beat analysts’ estimates.
PMI Index: Component Growth Impacts Banks
A growing economy definitely benefits the banking sector. The impact will be positive for big banks and also for regional banks.
An Introduction to KeyCorp and Its Banking Business
KeyCorp is a large regional bank with about $94 billion in assets. It competes with JP Morgan (JPM) and Bank of America (BAC) in various service segments.
Must-know: Investing in KeyCorp through ETFs
KeyCorp (KEY) is represented in key ETFs focused on the banking sector. The SPDR S&P Bank ETF (KBE) has KeyCorp comprising ~1.7% of its portfolio.
SunTrust Bank’s Commercial Lending Experiences Strong Growth
Since 2010, the loan portfolio of SunTrust Bank (STI) has had a compound annual growth rate (or CAGR) of 3.5%. Commercial loans have had a CAGR of 8.2%.
SunTrust Bank’s Deposit Growth Lower than Industry Average
STI’s deposit growth is clearly lagging behind the industry average. Other banks are experiencing strong growth in this area.
BB&T’s Loan Growth Is below the Average Rate
BB&T hasn’t acquired many banks since 2009. Completing the Bank of Kentucky and Susquehanna acquisitions might boost the bank’s loan growth.
BB&T to Expand Its Footprint in Ohio and the Mid-Atlantic Region
BB&T’s Susquehanna acquisition will significantly expand BB&T’s Mid-Atlantic footprint. The deal is valued at ~$2.5 billion. It will close in the second half of 2015.
J.P. Morgan Leads in Loan and Deposit Growth
J.P. Morgan is the leader in generating market revenue and investment banking fees. It generated more in the last five years than all its competitors.
Capital One’s focus on banking channels will likely payoff
Banking channels are modes used by customers to access their bank and fulfill their banking needs. Technology reshaped how we access banks.
Why the auto finance market share needs to be protected
Auto finance is a business where Capital One (COF) grew rapidly. The bank entered the market in 1997. Since then, it has been able to build a sizeable market share.
Why Capital One should maintain its strength in credit cards
Capital One’s (COF) core business is credit cards. To this day, most of Capital One’s expansion is funded by the credit card business.
Capital One: A geographical focus is the way to go
The most important element in Capital One’s strategy is a strong geographical focus. It concentrates its limited assets into geographies where it’s strong.
Capital One’s return on equity improved from subprime lows
Capital One (COF) saw a sharp fall in its return on equity during the subprime crisis. Its average ROE was nearly 10% over 2014. This is good and sustainable.
Capital One’s Tier I ratio of capitalization is adequate
Regulations requires Capital One (COF) to maintain a Tier I ratio of at least 8%. The bank maintained a Tier I ratio of 12.16% at the end of 4Q14.
Capital One’s non-interest expenses are controlled
For banks, non-interest expenses can be controlled. Controlling non-interest expenses helps a bank have higher net profitability.
Capital One’s commercial banking loan growth is on track
Commercial banking is used to provide lending and depository services, treasury management, and private banking and wealth management services.
Capital One’s consumer banking business disappointed in 2014
Overall, Capital One’s consumer banking results were below expectations in 2014. Consumer banking’s total revenue stood at $6,432 million in 2014.
Money spinner – Capital One’s domestic credit card business
The total revenue from Capital One’s domestic credit card business was $13,621 million. This was a decrease of 4.66%—compared to 2013.
A legacy – Capital One’s credit card business
The credit card business is Capital One’s oldest and the most important business. It’s a business where the bank enjoys significant competitive advantages.
Analyzing Capital One’s business segments
Capital One (COF) can be understood best by breaking it into different business segments—Credit Card, Consumer Banking, and Commercial Banking.
Why Capital One’s deposit quality is excellent
Capital One has among the highest percentage of FDIC insured deposits in the industry. This indicates good deposit quality.
Strength in numbers: Capital One has a healthy deposit base
Over the years, Capital One’s deposit base increased at a steady rate. At the end of 2014, its total deposits stood at $246.34 billion. It was an increase of 9.41%.
What are Capital One’s three main subsidiaries?
Capital One is organized into subsidiaries. Capital One’s principal subsidiary is a limited purpose credit card bank. It’s chartered in Virginia.
Capital One’s history: From credit cards to a diversified bank
Capital One’s history is shorter than other banks. In 1994, Signet Financial Corp. spun off its credit card business into a separate subsidiary—Capital One.
Capital One: Is it a good pick for your portfolio?
Capital One (COF) is one of the largest banks in the US. The bank offers an array of financial products and services to its customers.
Valuation of PNC Bank is close to historical mean
PNC stock was trading at a PBV ratio of 0.75 in November 2012. Since then, the stock has seen a smart move up and trades at a PBV multiple of ~1.08.
PNC Bank’s financial strengths outweigh its weaknesses
PNC Bank has done a good job at reducing its non-interest expenses, but the bank’s efficiency ratio still remains above 60%.
PNC Bank sees improved return on equity
PNC Bank improving its ROE to above 9% and is now outperforming the sector averages in this important return indicator.
Non-performing assets are at a manageable level
PNC Bank saw a declining trend in non-performing assets in the medium term and reported declining NPA for 12 continuous quarters.
Non-interest expense management can improve at PNC Bank
PNC’s net interest expenses stood at ~$9.5 billion at the end of 2014, $193 million lower than 2013 after curtailing salary and miscellaneous expenses.
Non-interest income of PNC Bank shows secular growth
PNC’s NII fell due to acquisitions made in 2009 and 2012. This led to a fall in non-interest income from the peak of 50% in 2007 to its low of 38% in 2012.
PNC Bank continues to have sluggish net interest margin
PNC Bank’s net interest margin has continued to fall in the last few years, with average earning assets standing at nearly $290 billion at the end of 2014.
Debt rating of PNC Bank is above average and stable
Liabilities such as securities, deposits, and instruments fund a bank’s assets, making liability analysis of a bank as important as those of assets.
Deposit growth of PNC Bank has been satisfactory
With the seventh largest deposit base in the US, PNC Bank had a deposit base of ~$239.5 billion at the end of 2014. Of this, 96.26% originated in the US.
PNC Bank loan book carries some risks
PNC Bank’s loan book is skewed toward a few types of loans: commercial and industrial loans and 1–4 Family First Liens, about 44.5% of its total loans.
PNC Bank: Loans positioned for increasing rates
An increasing interest rate spread between long-term and short-term rates allow banks to pay less on short-term deposits and earn more on long-term loans.
PNC Bank asset growth has been good
With total assets of nearly $335 billion, almost three-quarters of PNC Bank’s total assets are productive assets, particularly loans and leases.
Does PNC Bank remain a strong long-term play?
With a strong presence in the East, South, and Midwest, PNC Bank offers community banking, wholesale banking, corporate banking, and asset management.
Why qualitative analysis should matter to Wells Fargo investors
Before investing, it’s important to analyze a bank qualitatively, as well as quantitatively. Qualitative analysis is more likely to determine how well a bank will perform over the long-term.
Must-know: Traditional banks face challenges
When a borrower isn’t able to pay back the loan, the loan is considered a non-performing asset (or NPA)—since the money for lending came from a depositor, the bank needs a large enough pool of capital to withstand such a shock.