Banks Get Ready to Release Earnings
Tomorrow banks start releasing their fourth quarter earnings. JPMorgan Chase is first up, with already-embattled Citi set to release earnings on Friday. After today’s retail sales data totally slammed the stock market, no one expects great things from banks. Indeed, with bailout money basically having done nothing to really help banks, it looks as though earnings season is going to be bleak. The Street reports on what is likely for financial institutions:
Banks will once again be busy setting aside additional capital for future loan losses, taking further impairments on securities-related instruments and assuring Wall Street that their capital levels are safe.
Indeed, the coming quarter is not expected to be kind to banks and other financial sector stocks, either. Predictions of a longer recession are causing jitters, and we just keep finding out more and more about over-leveraged positions and exposure to risk. Banks are in a bad way.
It would be a great time to buy financial sector stocks, exept there is absolutely no way of predicting which banks will completely implode, leaving stock utterly worthless. This is because in the current volatile economic climate, anything could send any bank over the edge. The recent disintegration of once venerable financial monoliths attests to that.
It’s always a tricky thing to pick stocks, but there are some bargains to be had, even in the financial sector. Look at fundamentals, and try to see if there is any good news buried in the up coming earnings reports. And, if you are unsure of any financial institution, look elsewhere. There are plenty of bargains in other sectors as well.
Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.
