Q3 Earnings Season Kicks Off: 22 of 25 Banks Beat Estimates, XLF Drops
The third-quarter earnings season kicked off with financial heavyweights like Bank of America, JPMorgan Chase & Co, and Goldman Sachs reporting their results. Out of 25 companies, 22 topped analysts' estimates for both earnings and revenue. However, the Financial Select Sector SPDR Fund ETF (XLF) saw a weekly drop of nearly 2% despite a 2.30% rise in the third quarter.
Goldman Sachs (GS) saw earnings, revenue, and net interest income exceed estimates, driven by increased investment banking activity and growth in its assets and wealth management unit. However, its stock dropped due to higher-than-expected Q3 expenses. Huntington Bancshares Incorporated (HBAN) and The Progressive (PGR) were the only companies to miss estimates for both top and bottom lines this week. Bank of America (BAC) beat analysts' consensus widely, with every line of business showing top and bottom-line improvement, and lifted the lower end of its Q4 net interest income guidance to $1.56 billion-$1.57 billion. Upcoming earnings include Blackstone (BX), Capital One Financial (COF), and Nasdaq (NDAQ). JPMorgan (JPM) and Citigroup (C) lifted their annual net interest income guidance following better-than-expected Q3 results, with JPM's annual NII expected around ~$92.2B and Citi's seen advancing ~5.5%. A total of 17 banks, two capital markets, two consumer finance companies, and three insurance companies reported earnings this week, with 34% of companies having reported their earnings so far.
The earnings season continues with more companies set to report. Notable upcoming reports include Blackstone, led by CEO Stephen A. Schwarzman, and Capital One Financial, with earnings expected to provide further insights into the financial sector's performance.
