Banking Earnings
The earnings season kicked off on a strong note! U.S. banks reported impressive results for the third quarter — and that’s something that concerns all of us as investors.
Let’s take a quick look at how Wells Fargo and Goldman Sachs performed, and then dive deeper into JPMorgan’s results.
WELLS FARGO
We start with Wells Fargo. The stock jumped 9% the past two days after the earnings release, reflecting the market’s confidence in the numbers presented.
Net income came in at $1.66 per share, and excluding one-time items, the figure rises to $1.73.
Revenue reached $21.4 billion, surpassing estimates and showing growth both year over year and quarter over quarter.
CEO Charlie Scharf highlighted the strongest loan growth in the past three years, while fee-based income from consumer and commercial segments was particularly impressive. The encouraging part is that all of this happened in an environment full of uncertainty.
GOLDMAN SACHS
Moving on to Goldman Sachs, where things were a bit more mixed. On the one hand, the bank easily beat market expectations, reporting EPS of $12.25 versus a forecast of $11.09, and revenue of $15.2 billion.
However, operating expenses reached $9.45 billion, above analysts’ estimates of $8.98 billion.
The market reacted negatively, with the stock falling 2.8%.
Still, investment banking activity surged 42% year over year, while asset & wealth management also strengthened significantly.
It’s clear that Goldman Sachs is investing in its future, steadily building a more diversified and resilient business model — even if that comes with temporarily higher costs.
JPMORGAN
Now to the main course of the day: JPMorgan Chase. As you know, it’s already part of my public portfolio, so we follow it closely.
Once again, JPMorgan delivered outstanding results, reaffirming its position as the leading force in global banking.
EPS came in at $5.07 versus estimates of $4.87,
while revenue reached $47.1 billion, far exceeding expectations.
Performance was strong across all segments:
Consumer & Community Banking up 9% year over year, with higher profitability and wider margins.
Investment Banking up 17%, driven by a strong rebound in underwriting and M&A fees.
Markets division revenue surged 24%, with fixed-income trading up 21% and equities up 33%.
Asset & Wealth Management rose 12%, with AUM exceeding $6.8 trillion and solid net inflows.
Even the outlook for the future looks bright. The bank raised its 2025 guidance, projecting net interest income of $95.8 billion, and issued a 2026 forecast of $95 billion — signaling both confidence in its trajectory and visibility into future earnings.
CEO Jamie Dimon noted that significant uncertainties remain — such as geopolitical tensions, elevated asset prices, trade tariffs, and persistent inflation. The bank also increased loan-loss reserves by $782 million and took a $170 million write-off following the collapse of Tricolor, a subprime auto lender.
INVESTMENT TAKEAWAY
The bottom line: the fundamentals are strong.
JPMorgan remains one of the most profitable, well-managed, and well-capitalized banks in the world.
The recent pullback is nothing more than a breather after a 25% rally over the past six months.
Posted Using INLEO