Bank of America
reported third-quarter revenue on Wednesday morning, and the results look favorable.
America's namesake earned more than Wall Street expected to push stocks up 1.5% in premarket trading, which boosted gains made Tuesday after peers reported good numbers.
Bank of America (ticker: BAC) earned 56 cents in earnings per share from $ 12.1 billion in net interest income. The consensus expectation on Wall Street was for $ 54 and $ 12.2 billion, respectively. Interest spreads fell year over year, but it was no surprise: Interest rates have fallen all over the world over the last 12 months.
"In a moderately growing economy, we focused on operating the things that are controllable," says CEO Brian Moynihan in the company's news release. "Our customer activity, the expansion of our customer base and our ability to gain market share in most of our businesses during the quarter reflect all responsible growth."
Credit values were stable during the third quarter. Loan rates as well as loans that did not perform fell somewhat in order. The bank closed the quarter with $ 2.4 trillion in assets and nearly $ 1.4 trillion in consumer deposits. Bank of America claims most consumer deposits of some US banks
It is a solid result for investors to digest. Although investors are more concerned about a declining economy, it is so far, so good for third-quarter numbers – at least in the financial sector.
Banks often kick off the performance reporting season. For investors holding points,
(C) beat revenue estimates, while
(GS) fell short.
All four stocks rose in Tuesday trading. Better than dreaded results, as well as low valuations, are two reasons for the regularly positive reactions. Banks are one of the least expensive sectors in
based on cost-to-earnings. For example, Bank of America shares 10 times estimated earnings by 2020.
Goldman Sachs' loss was partly due to investments in
(UBER) and WeWork. Goldman Sachs is, of course, an important US financial institution, but it is an investment bank and not directly comparable to the commercial banks that run most of the lending business with US savers and businesses.
Bank of America shares are up more than 20% to date, better than the comparable gain of
Dow Jones industrial average.
The bank organizes a conference call for investors and analysts at 20:30 to discuss the results.
Write to Al Root at firstname.lastname@example.org