Banking on Banks: Five hot bank stocks based on earnings to explore

Summary

  • Goldman Sachs (NYSE: GS) net income applicable to common stockholders in Q2 was US$ 5.35 billion, a vast 2614% up YOY.
  • Citigroup, Inc. (NYSE: C) net income increased nearly 487% YOY. The stock price surged 33% in one year.
  • Wells Fargo & Company (NYSE: WFC) revenue for the June quarter was US$ 20.27 billion, 11% up YOY. The stock rose 77% in one year.

While the NASDAQ Composite Index (COMP) returned 40% in one year, the Nasdaq Bank Index (BANK) provided 64% growth in the past year. Banks are the backbone of any economy, and as such, these stocks attract significant interest from investors.

In addition, the central bank works to stabilize the economy by using measures for short- and long-term perspectives. Thus, the performance of the banking stocks is often closely tied to the health of the economy.

Here we explore five US banking stocks based on their earnings profile.

Goldman Sachs Group, Inc. (NYSE: GS) provides wealth and asset management services, consumer, and investment banking services to clients.
It has a market capitalization of US$ 127.35 billion and a P/E ratio of 6.77, with a forward P/E for one year of 7.11. Its current dividend yield is 1.33%.

The total net revenue for the June quarter was US$15.39 billion, a 16% up YoY. The net income applicable to common stockholders was US$5.35 billion, a massive 2614% jump YoY. The EPS diluted was US$15.02 compared to US$0.53 in the year-ago period. 

The stock rose 86% in one year and 41.69% YTD. It closed at US$374.84 on July 27, 2021.

Also Read: Are semiconductor stocks in US still talk of the town?

Source: Pixabay

Also Read: Microsoft’s revenue surges 21% in Q4, Apple’s Q3 income up 36%

JP Morgan Chase & Co. (NYSE: JPM) provides consumer & community banking, corporate & investment banking, commercial banking, and asset & wealth management. Its market capitalization is US$452.56 billion, and the P/E ratio is 10.1.

The bank posted strong Q2 results on July 13. Its revenue was US$31.4 billion, a 7% dip from the previous year’s June quarter revenue. Its net income was US$11.95 billion, a 155% increase year-over-year. The earnings per share diluted were US$3.78 compared to US$1.38 in the same quarter of 2020.

The stock went up nearly 56% in one year and 18.94% YTD. The stock closed at US$151.45 on July 27, 2021.

Also Read: 10 technology stocks that are under US$100 but popular on NASDAQ

Bank of America Corporation’s (NYSE: BAC) reportable segments are consumer banking, global banking, global markets, and global wealth investment management.

BAC’s market capitalization is US$327.66 billion, and the P/E ratio is 12.7. The forward P/E for one year is 11.51. The dividend yield is 1.89%, and annualized dividend is US$0.72.

Its revenue net of interest expenses for the June quarter was US$21.5 billion, an approximately 4% decline YoY. Its net income was US$9.2 billion, a 163% up YoY. Its EPS diluted was US$US$ 1.03 compared to US$0.37 in the June quarter of 2020.

On July 21, the bank announced a regular quarterly cash dividend of US$0.21 per share for common shareholders, payable on September 24, 2021, to on-record shareholders as of September 3, 2021.

BAC stock price increased by 56% in one year. The YTD return is 24.78% at the close at US$37.98 on July 27, 2021.

Also Read: Seven blue-chip stocks that investors are watching right now

Citigroup, Inc. (NYSE: C) operates in two segments: the Global Consumer banking segment provides branch banking services, and the Institutional client group provides investment banking and cash management and other services.

Citigroup has a market capitalization of US$138 billion and a P/E ratio of 6.86. Its dividend yield is 3.01%, and an annualized dividend is US$2.04.

Its total revenue for the June quarter was US$17.47 billion, 12% down compared to the June quarter of 2020. The net income increased by nearly 487% YoY to US$6.19 billion. The EPS diluted was US$2.85. 

The stock price surged 33% in one year and 9.62% YTD at the close of US$67.98 on July 27. 

Source: Pixabay

Also Read: What drove the bitcoin price surge? Where is the coin sitting now?

Wells Fargo & Company (NYSE: WFC) has four reportable segments: consumer banking, commercial banking, corporate & investment banking, and wealth & investment management.

It has a market capitalization of US$185.6 billion and a P/E ratio of 12.95. The dividend yield is 0.89%, and the annualized dividend is US$0.40.

The revenue for the June quarter was US$20.27 billion, 11% up YoY. The net income was US$6.04 billion compared to the net loss of US$3.85 billion in the prior-year quarter. The EPS diluted was US$1.38. 

The stock rose 77% in one year and 49.20% YTD. The share closed at US$45.14 on July 27, 2021.


Please note: The above constitutes a preliminary view and any interest in stocks/cryptocurrencies should be evaluated further from an investment point of view.

The reference data in this article has been partly sourced from Refinitiv.

Comment


Disclaimer