Bank stocks are mostly in the green today following a host of surprisingly upbeat earnings reports this week. Morgan Stanley (NYSE:MS), Citigroup (NYSE:C) and Goldman Sachs (NYSE:GS) are each up more than 1% so far this morning.
So, what’s going on with these banking giants lately?
Well, a number of major banks recently announced quarterly earnings for their fiscal Q1 2022. Despite reporting lower year over year profits on today’s earnings calls, Wells Fargo (NYSE:WFC), Citigroup, Goldman Sachs and Morgan Stanley each beat Wall Street profit expectations. As previously assumed, the complex market environment proved a significant factor in the banks’ financial results this quarter.
Goldman also managed to top analyst revenue expectations despite reporting year over year losses. Indeed, the company reported revenue of $12.93 billion, topping the expected $11.83 billion.
In terms of revenue, Wells Fargo was unable to keep up with competition. The bank beat earnings estimates, offering adjusted profit of 88 cents per share compared to forecasts of 81 cents. However, Wells Fargo reported revenue of $17.6 billion, failing to meet consensus revenue of $17.8 billion.
Bank Stocks In Flux Following Mixed Earnings Calls
At the time of writing, Citigroup and Morgan Stanley appear the only clear winners of today’s earnings reports. C and MS stocks are each up a bit less than 2% heading into the afternoon. That makes sense given their comparatively strong respective earnings calls.
Despite posting a 46% profit drop of $2.02 earnings per share (EPS) this quarter, Citi still managed to hardily beat the $1.43 EPS consensus estimate.
Likewise, Morgan Stanley investors were clearly pleased by the company’s earnings. MS reported revenue of $14.8 billion, beating the estimated $14.2 billion, although still far from last year’s $15.72 billion. Additionally, the company manage to surpass profit predictions, reporting $2.02 EPS compared to estimates of $1.71. MS may also be benefitting from recent news out of Tesla (NASDAQ:TSLA) Chief Executive Elon Musk. The CEO apparently hired Morgan Stanley to advise his recent bid to acquire Twitter (NYSE:TWTR).
Unfortunately, not everyone is trending up today. JPMorgan Chase (NYSE:JPM) is currently down slightly following a “cautious” earnings call Wednesday. Goldman Sachs is similarly trading sideways today. Wells Fargo may prove the banking bear today, however. WFC is currently trending down more than 3% at the time of writing.
As economic conditions continue to unfold, investors will surely be watching banks closely amid impending interest rate hikes and continued inflation concerns.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
