JPM, WFC, C: Big U.S. Banks Will Report Earnings Tomorrow. Key Things to Know

JPMorgan Chase, Wells Fargo, and Citigroup are scheduled to report their Q3 earnings tomorrow, October 14, with analysts projecting specific financial outcomes for each. JPMorgan is expected to post EPS of $4.85 on $45.47 billion in revenue. Wells Fargo is forecast to report EPS of $1.55, a 9% year-over-year increase, despite an anticipated 50% revenue decrease to $21.15 billion, with some analysts, like Citi's Keith Horowitz, maintaining a Hold rating due to limited upside. Citigroup is projected to show a 15% EPS rise to $1.73 on $21.09 billion in revenue, following its recent Banamex stake sale which prompted valuation concerns from UBS analyst Erika Najarian, who also holds a Hold rating. Despite some analyst caution, all three banks hold a "Moderate Buy" consensus rating, with Citigroup offering the highest average price target upside potential at 15.3%.

Analysis

Three major U.S. banks, JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C), are scheduled to report Q3 earnings tomorrow, October 14. Analysts anticipate JPM to post EPS of $4.85 on $45.47 billion in revenue, while WFC is projected to deliver $1.55 EPS, a 9% year-over-year increase, despite an expected 50% revenue decline to $21.15 billion. Citigroup is forecast to see a 15% Q3 EPS growth to $1.73 on $21.09 billion in revenue.

Wells Fargo's 12% year-to-date stock gain is attributed to strong earnings, cost controls, and steady loan growth, though Citi analyst Keith Horowitz maintains a Hold rating due to limited upside. Citigroup, up 36.3% YTD, benefits from cost-cutting and robust trading/investment banking revenue. However, UBS analyst Erika Najarian holds a Hold rating, citing concerns over the lower-than-expected valuation from the recent 25% Banamex stake sale.

Despite some analyst caution, all three banks hold a "Moderate Buy" consensus rating from Wall Street. Citigroup offers the highest implied upside potential at 15.33% from its average price target of $108.33, followed by Wells Fargo at 14.66% ($89.00 target), and JPMorgan at 9.7%. The overall sentiment surrounding these reports is moderately positive, with an optimistic tone.

Key Decisions for Investors

• Investors should closely monitor the actual Q3 earnings reports for JPMorgan, Wells Fargo, and Citigroup tomorrow, comparing reported figures against analyst expectations, particularly for revenue trends and specific segment performance.
• Pay close attention to Wells Fargo's forward guidance on cost controls and loan growth, given the projected 50% revenue decline and existing analyst caution on upside potential.
• Assess Citigroup's detailed commentary on the Banamex divestiture and its impact on future profitability, as the sale's valuation has raised analyst concerns.
• While all three banks carry a 'Moderate Buy' consensus, investors should weigh the higher implied upside potential of Citigroup and Wells Fargo against the specific analyst reservations highlighted for each.