Hey guys, how about some discussion about the Q1 earnings to be reported by our favorite banks?
http://www.google.com/hostednews/afp/article/ALeq…
GS seems to be on the upswing, and Citi shares jumped ahead of the earnings reports later this week. Anyone know specific dates when the rest of the big banks are announcing their Q1 earnings? The article only mentions JPM and Citi.
I would like to hear what my fellow monkeys think of what this good news might imply for the financial sector and the economy as a whole.
GO.
It's going to be very difficult for the market to get a real read on these reports due to the recent change in mark-to-market accounting. As nice as it would be to believe GS really turned a $3.39 EPS this quarter, it's tough to really compare that number to the past few quarters. It's just difficult to compare due to the change in accounting standards - who knows what kind of write-down they would have had to take had this change not been passed, and that will make it difficult to get a really good read on the rest of the financials as they report this week.
That being said, at least this SOUNDS like good news. It should restore at least some confidence in the financials.
What about the fact that GS also significantly over-performed the revenue expectations? Might that be an accounting mirage as well or is that number more telling?
I certainly do not know enough to answer this definitively, but it is really difficult to truly compare analysts' estimates to their actual earnings because analysts predicted the estimates under the mark-to-market standards, not under what has been released now. Doubling the estimates looks awesome, but again, it's really difficult to get a gauge on what the ~$3.40 EPS really is relative to past quarters. This stupid fucking change in mark-to-market makes everything far less transparent for investors, because they have no clue how to interpret GS' report. If they had to take write downs, where would their earnings have been?
I may be off on this, but to me, this mark-to-market bullshit is just causing more and more problems. We're looking for transparency, and this is not giving it to us.
BAC is releasing earnings on 20th April, MS also sometime next week ..
Most Analysts are expecting Citi and Morgan Stanley to declare Q1 losses: http://www.bloomberg.com/apps/news?pid=20601109&sid=aLo7f1AKca.o&refer=…
If Citi somehow surprises everyone with a profit, market sentiment will definitely prolong the current rally since Citi is the most troubled of the major banks..
Not earning related...but I'm impressed that GS could successfully complete a $5Bn stock offering. This implies the capital markets are loosening up and the pessimism surrounding financials is beginning to lift.
Granted it's Goldman and they are doing better than most, but the offering didn't have a steep discount (vs. Buffet's preferred deal of the century). This will open the door to other banks' capital raising and ultimately payback of TARP funds.
Didn't a lot of revenues from GS pour in through AIG?
let me google that for you:
http://tinyurl.com/ckxfkz
Only two things are infinite, the universe and human stupidity, and I'm not sure about the former.
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