JPMorgan kicked off Wall Street earnings season on Thursday — and it crushed expectations.
The firm reported earnings per share of $1.32 ($1.28 expected) on revenue of $23.7 billion ($23.24 billion expected). It beat analyst expectations in every major division except for equities.
The thing is, analysts were expecting the fourth quarter to be a particularly feeble, “clean-up” quarter after a turbulent three months.
But now things are off to a pretty good start, and that means the bar is set high for other Wall Street banks set to report earnings over the coming days.
If JPMorgan had missed, the others would likely have missed as well. Of course, the fact that JPMorgan beat expectations does not guarantee that the others will too, but it does at least set a more positive tone as we start bank earnings season.
In November, investment bank head Daniel Pinto said that fourth-quarter trading revenue would be unchanged from the year prior and that the rates business would perform better than other businesses, like credit. He even said that equities volume would be down.
Underlying revenues in the corporate and investment bank would likely be flat with the same period a year earlier, and down around 15% on the third quarter, he said. He was pretty much bang on.
For Wall Street banks, delivering on what you say you will do may be the new “outperform.”
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