M&T Bank Corporation (MTB) is set to unveil its first-quarter 2024 financial results on April 15, before the morning bell amidst expectations of a year-over-year decline in both revenue and earnings for the period under review. In the previous quarter, the company fell short of the Zacks Consensus Estimate due to an increase in provision for credit losses, a drop in net interest income (NII), and higher expenses. However, there was a silver lining with a rise in loans and leases, as well as higher rates.
The Performance Track Record
M&T Bank’s earnings have outpaced the consensus estimate in three of the last four quarters, with a slight average surprise of 1.67%.
Expectations for Q1
Despite the upcoming quarterly report, analysts have not shown optimism in revising earnings estimates upward. The Zacks Consensus Estimate for MTB’s first-quarter earnings stands at $3.12, reflecting a 23.7% downturn from the corresponding figure last year. On the revenue front, the consensus estimate indicates a 6.2% dip to $2.26 billion compared to the previous year.
Factors Impacting Q1 Performance
Loans & NII: The demand for commercial and industrial loans, including real estate loans, experienced improvements leading up to the end of the fourth quarter of 2023. Additionally, consumer lending showcased signs of a rebound. The stable macroeconomic environment and the anticipated easing of interest rates by the Federal Reserve likely supported the lending landscape during the period. Consequently, M&T Bank is expected to have witnessed decent loan growth, particularly due to its exposure in commercial real estate and commercial loans.
As of February 2024, average loans saw an uptick to $133.5 billion from the fourth quarter of 2023, supported by commercial and industrial loans, as well as consumer loans. This increase is presumed to have a positive impact on average interest-earning assets for the quarter. Despite the Fed’s halt on interest rate hikes, the existing elevated interest rates coupled with an inverted yield curve and increased funding costs are likely to have adversely affected NII in the upcoming report.
Fee Income: The reduction in average total deposits, mainly due to a decline in brokered deposits, is anticipated to continue impacting revenues from service charges on deposit accounts in the forthcoming quarter.
Moreover, the surge in mortgage rates during the first quarter is predicted to have led to a decrease in origination volumes, particularly in purchase originations, offsetting the benefit of home price appreciation. These factors may result in a decline in M&T Bank’s mortgage banking revenues during the quarter. Additionally, the expected distribution from Bayview could bolster fee income for the period.
Expenses: The mounting expense base of M&T Bank might have hindered bottom-line growth in the initial quarter of the year. The company foresees expenses in the range of $1.365-$1.380 billion, including higher seasonal compensation expenses.
Predictive Model Insights
Our predictive model does not forecast an earnings beat for M&T Bank in the upcoming report. For a likely earnings surprise, a positive Earnings ESP combined with a Zacks Rank of #1, #2, or #3 is usually indicative. However, M&T Bank currently holds a Zacks Rank of 3 and an Earnings ESP of -1.06%.
For investors looking to stay ahead of the curve, it’s worth noting a few bank stocks with potential for an earnings beat:
Truist Financial (TFC): Scheduled to unveil its first-quarter 2024 earnings on April 22, TFC currently bears a Zacks Rank #3, with an Earnings ESP of +0.83%.
The Buzz Around Fifth Third Bancorp (FITB) First-Quarter 2024 Earnings Release
Fifth Third Bancorp (FITB) is poised to unveil its financial performance for the first quarter of 2024 on April 19. As the market eagerly anticipates this event, the company currently holds a Zacks Rank #3, with an enticing Earnings ESP of +0.89%. This positive outlook adds an extra layer of excitement to the upcoming earnings report.
Surprising Earnings Momentum
Delving into FITB’s financial landscape, its quarterly earnings projections have witnessed a slight upward revision in the past week. This upward trajectory indicates a promising start to the fiscal year, potentially setting the stage for a robust performance in the quarters to come.
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The Unbeatable $1 Deal
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Exploring Financial Landscapes
As the financial world eagerly awaits FITB’s first-quarter earnings release, market participants are keen on unlocking the treasure trove of insights that this report may offer. With Zacks Investment Research at the forefront of delivering unbiased analysis and valuable recommendations, investors are well-equipped to traverse the dynamic landscape of stock markets with confidence.
For more detailed insights into FITB’s financial performance and expert analysis, readers can access the full article on Zacks.com. There, a comprehensive breakdown of the factors influencing FITB’s earnings and market position awaits, providing a holistic view of the company’s standing.
On the financial canvas where companies lay bare their successes and challenges, FITB’s earnings reveal promises to paint a picture that investors eagerly await. With the Zacks Rank #3 tagline adding a sprinkle of optimism to the narrative, FITB’s first-quarter earnings release is anticipated to herald a new chapter in its financial saga.
The Author’s Perspective
As the financial markets gear up for FITB’s earnings reveal, the author’s views and opinions offer a unique lens through which to perceive the company’s journey. While the author’s insights are subjective, they serve as a thought-provoking addition to the ongoing discourse surrounding FITB’s financial performance and market outlook.
