financial stock – Purple Ribbon Project http://purpleribbonproject.com/ Wed, 23 Feb 2022 15:30:19 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://purpleribbonproject.com/wp-content/uploads/2021/10/icon-12.png financial stock – Purple Ribbon Project http://purpleribbonproject.com/ 32 32 Cincinnati Financial Stock Reported Strong Fourth Quarter Results, What to Expect? https://purpleribbonproject.com/cincinnati-financial-stock-reported-strong-fourth-quarter-results-what-to-expect/ Wed, 23 Feb 2022 15:30:19 +0000 https://purpleribbonproject.com/cincinnati-financial-stock-reported-strong-fourth-quarter-results-what-to-expect/ UKRAINE – 03/04/2021: In this photo illustration of the TradingView stock chart of Cincinnati … [+] Financial Corporation seen displayed on a smartphone with the Cincinnati Financial Corporation logo in the background. (Photo illustration by Igor Golovniov/SOPA Images/LightRocket via Getty Images) SOPA Images/LightRocket via Getty Images Cincinnati Financial Action (NASDAQ: CINF) gained 3.7% last week, […]]]>

Cincinnati Financial Action (NASDAQ: CINF) gained 3.7% last week, outperforming the S&P 500 (down 1.4%). Additionally, the stock is up 8.5% over the past month versus a 2.8% drop in the broader markets. Overall, the stock has improved in the short term, unlike the S&P500 index.

The company offers P&C insurance products in the United States. It recently released its fourth quarter results, beating consensus estimates for profit and revenue. Total revenue increased 23% year-on-year to $3.3 billion in the quarter, primarily driven by 10% growth in total premiums and an 8% increase in net income investments. In addition, this translated into a 40% jump in net sales. Along the same lines, CINF’s revenue increased 28% year-on-year to $9.6 billion and net profit improved 142% year-on-year to $2.9 billion in fiscal year 2021. Notably, the unusually high net income figure was due to higher revenues and a decline in total profit and expenses as a % of revenue. The growth above was the main reason for positive investor sentiment towards the stock.

Now, should CINF stock rise further or can we expect a decline? We believe there is a 61% chance of a rise in Cincinnati Financial stock over the next month (21 trading days) based on our machine learning analysis of stock price trends over the past ten last years. See our analysis on Cincinnati Financial Stock Chance Upside.

Additionally, if you are considering Cincinnati Financial stock as a longer-term investment option, you can explore our forecast for Cincinnati Financial Valuation.

Twenty-one day: CINF 8.5%, vs. S&P500 -2.8%; Market outperformed

(11% probability event; 61% upside probability over the next 21 days)

  • Cincinnati Financial Action gained 8.5% over the past twenty-one trading days (one month), versus a broader market (S&P500) down 2.8%
  • A change of 8.5% or more over twenty-one trading days is an 11% probability event, which has occurred 267 out of 2517 times in the last ten years
  • Of these 267 instances, the stock has seen positive movement over the next twenty-one trading days on 163 occasions.
  • This indicates a 61% chance that the stock will rise over the next twenty-one trading days.

Ten days: CINF 3.2%, vs. S&P500 -3.2%; Market outperformed

(23% probability event; 59% upside probability over the next 10 days)

  • Cincinnati Financial Action increased by 3.2% over the past ten trading days (two weeks), versus a broader market (S&P500) down 3.2%
  • A change of 3.2% or more over ten trading days is a 23% probability event, which has occurred 581 out of 2,517 times in the past ten years
  • Of these 581 instances, the stock has seen positive movement over the next ten trading days on 341 occasions.
  • This indicates a 59% chance that the stock will rise over the next ten trading days

Five days: CINF 3.7%, vs. S&P500 -1.4%; Market outperformed

(8% probability event; 61% upside probability over the next five days)

  • Cincinnati Financial Action gained 3.7% over a five-day trading period ending 02/18/2022, relative to the broader market (S&P500) down 1.4%
  • A change of 3.7% or more over five trading days (one week) is an 8% probability event, which has occurred 198 out of 2517 times in the last ten years
  • Of these 198 instances, the stock has seen positive movement over the next five trading days on 120 occasions.
  • This indicates a 61% chance that the stock will rise over the next five trading days

What if you were looking for a more balanced portfolio instead? here is a quality portfolio which has consistently beaten the market since late 2016.

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Is it the right time to buy? https://purpleribbonproject.com/is-it-the-right-time-to-buy/ Thu, 03 Feb 2022 08:00:00 +0000 https://purpleribbonproject.com/is-it-the-right-time-to-buy/ Shares of credit card issuer Synchrony Financial (SYF) have seen a strong price rebound from their pandemic-induced declines. However, the stock has slumped lately despite solid growth in the company’s latest quarter. So, is SYF a suitable investment given the impending Federal Reserve interest rate hike? Continue reading. shutterstock.com – StockNews Consumer financial services company […]]]>

Shares of credit card issuer Synchrony Financial (SYF) have seen a strong price rebound from their pandemic-induced declines. However, the stock has slumped lately despite solid growth in the company’s latest quarter. So, is SYF a suitable investment given the impending Federal Reserve interest rate hike? Continue reading.

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Consumer financial services company Synchrony Financial (SYF) in Stamford, Connecticut, offers a range of credit products through programs it has established with a group of national and regional retailers, local merchants, manufacturers, buying groups, industry associations and health service providers . The COVID-19 pandemic has hit the credit card issuer hard, forcing it to increase its reserve provision, building up large provisions for credit losses. Consequently, the company’s bottom line suffered. However, SYF shares rebounded in 2021 as the company bolstered its capabilities with new partnerships and diversification strategies. SYF shares have gained 18.5% in price over the past year, but have fallen 8% since the start of the year. The stock fell slightly during the day to close yesterday’s trading session at $42.70.

Despite posting strong fourth quarter earnings in line with expectations, the stock failed to generate momentum. Its net interest income exceeded forecasts, driven by record purchase volume and loan growth across all sales platforms. For its 2022 outlook, the company expects continued strength in purchase volume across all sales platforms and anticipates moderation as consumer savings and payment rates decline. It also expects its net interest margin to be consistent with the second half of 2021 and the proceeds from the portfolio disposal to create excess liquidity in the second and third quarters. This could have a negative impact on its net interest margin (NIM).

In addition, the company expects net charges and delinquencies to increase from current levels. In addition, he expects the current expected credit loss (ECCL) transition to reduce CET1 of 62 basis points.

Here’s what could shape SYF’s performance in the near term:

Significant growth in its last reported quarter

SYF’s net interest income rose 4.7% year-over-year to $3.83 billion in the fourth quarter ended Dec. 31. Its net income rose 10.2% from its value a year earlier at $813 million, while its EPS rose 19.4% year-over-year. year at $1.48. Its provision for credit losses was down 25%, due to lower net charges and lower reserve charges, including amounts attributable to HFS portfolios. And its average active accounts are up 5% from its value a year ago at 69.4 million.

Its efficiency ratio increased four percentage points from the prior year quarter to 41.1%, and its net interest margin increased 113 basis points to 15.77%. However, SYF’s ROE declined by 0.6 percentage points to 23%.

Mixed analyst expectations

Analysts expect SYF’s revenue to decline slightly year-over-year to $3.60 billion in the quarter ending March 2022. However, its revenue is expected to increase by 1.8 % in the next quarter and 3.1% in the current year. But the Street expects the company’s EPS to decline 9.8% year-over-year in the current quarter, 33.5% in the next quarter and 23.8% in the of the current year. But it is expected to grow by 35.9% per year over the next five years.

Seems undervalued at its current price

In terms of forward P/E, SYF is currently trading at 7.68x, 35.5% below the industry average of 11.90x. Additionally, its forward price-to-sales ratio of 2.01 is 39.3% below the industry average of 3.32. Its forward price/cash flow of 5.94x is 39.4% below the industry average of 9.81, while its non-GAAP forward PEG is 85.1% below the industry average. sector.

POWR ratings reflect uncertainty

SYF has an overall C rating, which translates to Neutral in our own POWR Rankings system. POWR ratings are calculated by considering 118 separate factors, with each factor weighted to an optimal degree.

The stock has a C rating for Momentum. This is warranted as the stock is currently trading below its 50-day moving average.

SYF has a D rating for Sentiment, in line with analysts’ expectations of declining revenue and EPS in the current quarter.

Among the 53 actions of the Consumer Financial Services industry, SYF is ranked #18.

Beyond what I said above, one can also check out SYF’s ratings for Quality, Growth, Value and Stability here.

See the highest rated stocks in the consumer financial services sector here.

Conclusion

SYF has had a strong rebound over the past year and experienced significant growth in its latest quarter. However, Street analysts are bearish on its near-term financial growth. Additionally, the stock has a 24-month beta of 2.04, indicating volatility. In addition, investors are worried about impending interest rate hikes. Although the financial sector tends to perform well when rates rise, “there is a danger in always saying it will happenwarned CFP Douglas Boneparth, president of Bone Fide Wealth in New York. Thus, I think it might be wise to wait for a better entry point in the stock.

How does Synchrony Financial (SYF) compare to its peers?

While SYF has an overall POWR rating of C, one might consider taking a look at its industry peers, Atlanticus Holdings Corporation (TRTA), OneMain Holdings, Inc. (OMF), and 360 Finance, Inc. (QFIN), which have a B (buy) rating.


Shares of SYF fell $0.01 (-0.02%) in premarket trading on Thursday. Year-to-date, SYF is down -7.95%, compared to a -3.71% rise in the benchmark S&P 500 over the same period.


About the Author: Subhasree Kar

Subhasree’s keen interest in financial instruments led her to pursue a career as an investment analyst. After earning a master’s degree in economics, she gained knowledge in equity research and portfolio management at Finlatics.

Continued…

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Fulton Financial Stock: higher provision to reduce profits this year https://purpleribbonproject.com/fulton-financial-stock-higher-provision-to-reduce-profits-this-year/ Sun, 09 Jan 2022 11:41:00 +0000 https://purpleribbonproject.com/fulton-financial-stock-higher-provision-to-reduce-profits-this-year/ [ad_1] Helen89 / iStock Editorial via Getty Images Profits of Fulton Financial Corporation (NASDAQ: FULT) will most likely decline this year due to the anticipated normalization of loan loss provisions. In addition, the rising interest rate environment will reduce mortgage bank income. On the other hand, economic strength will drive loan growth, which in turn […]]]>


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Profits of Fulton Financial Corporation (NASDAQ: FULT) will most likely decline this year due to the anticipated normalization of loan loss provisions. In addition, the rising interest rate environment will reduce mortgage bank income. On the other hand, economic strength will drive loan growth, which in turn will support the bottom line. In addition, higher interest rates will increase the net interest margin. Overall, I expect Fulton Financial to report earnings of $ 1.32 per share in 2022, down from the expected earnings of $ 1.65 per share for 2021. The current market price is fairly close to the target price for the coming year. Therefore, I take a neutral rating on Fulton Financial.

Higher fares, a strong economy to drive the top line

Fulton Financial Corporation’s net interest income grew 6.5% in the first nine months of 2021 year over year. The outlook for net interest income growth remains optimistic for 2022, in part due to rising interest rates. According to management’s interest rate sensitivity analysis, an instantaneous change in interest rates of 100 basis points can increase net interest income by 6.8%, as mentioned in file 10-Q . This sensitivity is based on the assumption of an instantaneous variation in interest rates. The impact of a gradual increase in rates will be much smaller. Nonetheless, net interest income will benefit from the anticipated hike in the federal funds rate and the deceleration of the federal bond purchase program.

In addition, Fulton Financial’s book already showed promising trends in the third quarter. Management mentioned on the conference call that the growth in commercial line usage during the quarter was really encouraging. In addition, management expects assemblies to continue to accelerate thanks to a strong pipeline.

In addition, economic strength will stimulate demand for credit. Fulton Financial operates in the mid-Atlantic markets of Pennsylvania, Maryland, Delaware, New Jersey and Virginia. In terms of inflation, while some markets, like Virginia, perform better than the national average, others, like New Jersey, are much worse. Therefore, instead of considering statewide measures, it is better to take the national average. The following charts show the positive trends in GDP, the Purchasing Managers’ Index and the unemployment rate.

US real GDP, unemployment rate
Data by YCharts

On the other hand, the following reasons are likely to limit revenue growth.

  1. The upcoming delivery of PPP loans. Fulton Financial still has a large outstanding Paycheck Protection Program (“P3”) loan balance that has yet to be canceled. According to the details given in the last presentation, PPP loans represented around 3.2% of total loans at the end of September 2021. As the share of PPP loans in total loans is significant, the upcoming cancellation will have a significant impact on the total size of the loan portfolio. .
  2. Hanging around money. Fulton’s cash and cash equivalents jumped to $ 2.5 billion at the end of September 2021, from $ 1.8 billion at the end of December 2020 and $ 0.5 billion at the end of December 2019. This excess cash problem put margin under pressure in recent quarters. Management mentioned during the conference call that they are looking to deploy excess liquidity into more profitable asset classes. However, such a rebalancing will probably be very difficult to achieve due to the tolerance of PPP discussed above. In addition, other banks are also looking to resolve their respective excess liquidity issues, which will keep competition high in the markets. Fulton’s excess cash position is likely to get worse before it gets better.
  3. Higher interest rates. The high rates will affect both the refinancing and mortgage buying markets. (Note: Fulton Financial issues mortgages for sale and investment. The loan balance, and therefore net interest income, is affected by mortgages issued for investment purposes, and non-interest income is affected by mortgages issued for sale).

Given the headwinds and headwinds discussed above, I expect net interest income to increase 4.5% year-on-year in 2022. Additionally, I expect the loan balance increases by 4% this year, which is close to the pre-pandemic level. The following table shows my balance sheet estimates.

Finton Fulton - Financial Position

Loan growth to help normalize provisioning

Fulton Financial has reported net provision reversals of $ 10 million in the first nine months of 2021. Further reversals cannot be ruled out as the provisions appear to be excessive relative to the portfolio’s credit risk. Endowments represent 1.41% of total loans, while non-performing loans represent 0.82% of total loans at end-September 2021, as mentioned in the presentation.

Due to the anticipated growth in single-digit loans, the allowance for expected loan losses will likely increase this year. Overall, I expect the provision charge, net of reversals, to return to a normal level in 2022. The provision charge represented 0.18% of total loans from 2016 to 2019. For 2022, I m ‘Expect the provision charge to rise about 0.17% of total loans.

Expect earnings of $ 1.32 per share in 2022

The higher provision charge will likely weigh on earnings this year compared to last year. In addition, non-interest income will most likely decline because the rising interest rate environment will reduce mortgage refinancing activity. As a result, mortgage banking income will be brought back to a more normal level this year. the Mortgage Bankers Association Mortgage refinancing arrangements are also expected to return to almost pre-pandemic levels this year, as shown below.

Fulton Financial Mortgage Originating Volume Forecast

On the flip side, the expected margin expansion and mid single-digit loan growth will likely support the bottom line. Additionally, the efficiency ratio will likely continue to improve in 2022. Fulton Financial has consolidated several branches in recent years and moved to online platforms, as mentioned in the presentation. The company has improved its digital capabilities, which include a cloud-based mortgage origination system that launched in 2020.

Overall, I expect Fulton Financial to report earnings of $ 1.32 per share in 2022. For the last quarter of 2021, I expect the company to report earnings of 0.39 $ per share, which will bring annual earnings to $ 1.65 per share. . The following table shows my income statement estimates.

Fulton financial income statement

Actual profits may differ materially from estimates due to the risks and uncertainties associated with the COVID-19 pandemic, particularly the Omicron variant.

Current market price above the end-of-year target price

Fulton Financial offers a 3.5% dividend yield at the current quarterly dividend rate of $ 0.14 per share and a special dividend of $ 0.08 per share. Fulton Financial typically announces a special dividend in the last quarter of the year. Estimates of earnings and dividends (including the special dividend) suggest a payout rate of 49% for 2022, which is not much higher than the 2016-2019 average of 44%. Therefore, I don’t think there is a threat of lower dividends despite the prospect of lower profits.

I use the historical price / earnings (“P / TB”) and price / earnings (“P / E”) multiples to value Fulton Financial. The stock has traded at an average P / TB ratio of 1.45 in the past, as shown below.

Fulton Financial Average Market Price

Multiplying the average P / TB multiple by the tangible book value per forecast share of $ 12.9 yields a target price of $ 18.7 for the end of 2022. This price target implies a 2.4% increase. compared to the closing price on January 7. The following table shows the sensitivity of the target price to the P / TB ratio.

Fulton Financial Price target

The stock has traded at an average P / E ratio of around 12.7x in the past, as shown below.

Fulton Financial EPS

Multiplying the average P / E multiple by the expected earnings per share of $ 1.32 yields a target price of $ 16.7 for the end of 2022. This price target implies an 8.5% decline from at the January 7 closing price. The following table shows the sensitivity of the target price to the P / E ratio.

FULL share price

The equal weighting of the target prices of the two valuation methods results in a combined target price of $ 17.7, which implies a decrease of 3.0% from the current market price. Adding the term dividend yield gives an expected total yield of 0.5%. Therefore, I take a neutral rating on Fulton Financial. I would only consider investing in the stock if its price drops more than 12% from its current level.

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Find out that financial stocks have 11% upside potential https://purpleribbonproject.com/find-out-that-financial-stocks-have-11-upside-potential/ Wed, 05 Jan 2022 08:00:00 +0000 https://purpleribbonproject.com/find-out-that-financial-stocks-have-11-upside-potential/ UKRAINE – 2021/06/17: In this photo illustration a Discover Financial Services Inc. logo seen … [+] displayed on smartphone and pc screen in background. (Photo illustration by Igor Golovniov/SOPA Images/LightRocket via Getty Images) SOPA Images/LightRocket via Getty Images [Updated 01/05/2022] Check out the Financial Stock update Discover the financial action (NYSE: DFS) has gained around […]]]>

[Updated 01/05/2022] Check out the Financial Stock update

Discover the financial action (NYSE: DFS) has gained around 28% in 2021 and is currently trading around $119. By comparison, the S&P500 is up 27% over the same period. That said, the stock has lost 3% in value since the third quarter results. Trefis estimates Discover the valuation of Financial at around $134 per share, or around 11% above the current market price. The company posted better-than-expected results in the third quarter, with revenue up slightly year-over-year. Although net interest income and discount and interchange fees showed some growth, this was partially offset by unrealized gains/(losses) on equity investments. Revenue improved in the first nine months of 2021 and we expect the trend to continue in the fourth quarter. Notably, the consensus estimates for fourth-quarter revenue and profit are around $2.99 ​​billion and $3.52, respectively.

The company’s revenue suffered a 3% year-over-year decline in 2020 due to lower NII and non-interest income. This development was driven by headwinds on interest rates, lower levels of consumer spending and lower outstanding loans. That said, the economy has seen some recovery in the first three quarters of 2021. The company reported an 11% year-over-year increase in nine-month cumulative revenue to $9.15 billion. We expect the same trend to continue in the fourth quarter, allowing Discover the earnings of Financial to touch $12.1 billion in fiscal 2021. In addition, the adjusted net profit margin is expected to increase from 10% to nearly 43% in fiscal year, primarily due to a favorable decrease in provisions for credit losses. It should result in an adjusted net profit of $5.2 billion and an EPS figure of $18.01. This, coupled with a P/E multiple just above 7x, will lead to a valuation of $134.

Below is our previous Discover Financial stock coverage where you can follow our view over time.

[Updated 11/11/2021] Is the price of Discover Financial Stock reasonable?

Discover the financial action (NYSE: DFS), the credit card giant, has gained 30% year-to-date, rising from its value of $91 at the start of 2020 to around $117 currently, outperforming the S&P500, which has risen by 24% over the same period. Additionally, the company’s net interest income and discount and interchange fees for the first nine months of 2021 improved 3% and 27% year-over-year, respectively.

There were two clear reasons for this: First, the easing of travel bans and Covid-19 restrictions benefited consumer spending levels. Second, favorable financing costs.

But we believe there are more benefits to come over the next few months.

Trefis estimates Discover the valuation of Financial at around $134 per share – around 14% above the current market price – based on a key opportunity and risk factor.

The opportunity we see is Discover Financial’s revenue growth in subsequent quarters. The company generates more than 90% of its total revenue from the direct banking segment. Nearly 85% of the share comes from NII. The NII suffered a decline of 2% year-on-year in 2020, due to lower outstanding loans and interest rate headwinds. In addition, non-interest revenue decreased 7% year-on-year due to lower discounts and interchange fees. That limited the company’s revenue to $11.1 billion in 2020, down 3% year-over-year. That said, the pattern has changed in fiscal 2021. The company recently released its third quarter results, beating consensus estimates for revenue and profit. It posted total revenue of $2.8 billion, up 2% year-on-year, driven by 6% growth in NII and a 26% increase in discount and interchange fees. Notably, turnover was partially offset by -$167 million of unrealized gains/(losses) on equity investments. Overall, the NII and discount and interchange fees both saw some improvement in the first three quarters of fiscal 2021. The cumulative NII for the first nine months improved by 3 % year-on-year, mainly due to favorable financing costs due to lower market rates and lower interest charges. Additionally, discount and interchange fees increased 27% year-on-year over the same period, primarily due to higher transaction volumes.

Going forward, we expect the same trend to continue in the final quarter of fiscal 2021. Overall, this will likely drive Discover Financial’s revenue to $12.1 billion over the course of the year. fiscal year 2021. Our dashboard on Discover Financial Revenues offers more detail on company segments.

Discover Financial’s profitability numbers suffered in 2020 due to large provisions for credit losses and higher expenses as a % of revenue. However, the company reduced its provisions figure in 2021, due to the improvement in the repayment capacity of its customers’ loans. Overall, the adjusted net profit margin is expected to increase from 10% to approximately 43% over the course of the year, generating net income of $5.2 billion. This will likely translate to EPS of $18.01, which, coupled with the P/E multiple just below 8x, will lead to a valuation of around $134.

Finally, how much should the market pay for every dollar of profit from Discover Financial? Well, to earn nearly $18.01 a year from a bank, you would need to deposit about $1,801 in a savings account today, or about 100 times your desired earnings. At the current Discover Financial stock price of around $117, we are talking about a P/E multiple of just below 7x. And we think a figure closer to 8x is appropriate.

That said, credit card issuance and electronic payment solutions currently appear to be a risky business. Growth looks less promising and the short-term outlook is far from rosy. What’s behind that?

Discover Financial is highly dependent on net interest income and consumer spending levels. While the NII has seen some recovery due to lower funding costs, the company has seen stagnant growth in outstanding loan balances. This has limited NII’s growth potential in the near term. Additionally, consumer spending levels have improved in recent quarters. However, any sudden increase in the number of Covid cases or worsening economic conditions may adversely affect the current trend. In summary, we think Discover Financial stock is undervalued.

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Return Jan 2022

MTD [1] 2022

YTD [1] 2017-22

Total [2] Yield DSF 3% 3% 54% Return of the S&P 500 0% 0% 79% Return of the MS Trefis portfolio 0% 0% 292% [1] Monthly and year-to-date cumulative as of 4/1/2022

[2] Cumulative total returns since 2017

Invest with Trefis Wallets that beat the market

Invest with Trefis Wallets that beat the market

See everything Trefis Price estimates

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Is Goldman Sachs Group A Good Financial Stock To Invest In? https://purpleribbonproject.com/is-goldman-sachs-group-a-good-financial-stock-to-invest-in/ Tue, 21 Dec 2021 13:41:58 +0000 https://purpleribbonproject.com/is-goldman-sachs-group-a-good-financial-stock-to-invest-in/ [ad_1] Shares of leading financial institution Goldman Sachs (GS) have gained 40.9% year-to-date thanks to its burgeoning investment banking division. However, analysts have voiced concerns about the company’s growth prospects for the coming year as the Fed plans to tighten monetary policy. So, is it worth adding the stock to your portfolio now? Let’s find […]]]>


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Shares of leading financial institution Goldman Sachs (GS) have gained 40.9% year-to-date thanks to its burgeoning investment banking division. However, analysts have voiced concerns about the company’s growth prospects for the coming year as the Fed plans to tighten monetary policy. So, is it worth adding the stock to your portfolio now? Let’s find out.

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The world’s leading financial institution, Goldman Sachs Group Inc. (SG), offers a wide range of financial services in the areas of investment banking, securities, investment management and personal banking services to a large and diverse clientele that includes businesses, financial institutions, governments and individuals. Its action has gained 40.9% in progress since the beginning of the year thanks to various collaborations.

The company beat analysts’ revenue expectations 16.6% and their EPS estimates of 47%, supported by strong performance in mergers and acquisitions (M&A), as well as a dynamic market for initial public offerings (IPO).

However, management cited a few key factors that could affect the company’s revenue growth over the coming months, including the increased likelihood of monetary policy tightening in the near term due to inflationary pressures. This would tend to deter companies from engaging in M&A activity. Additionally, GS shares were down 4.1% in price over the past month due to a market sell off over growing concerns over the omicron COVID-19 variant.

Here’s what could shape GS’s performance in the short term:

Analysts forecast slower growth

Analysts expect the company’s growth to slow in the fourth quarter, with revenues expected to rise 2% year-on-year, while earnings per share fall 3%. Additionally, analysts are less optimistic about growth in 2022, predicting sales to fall 17.5%, while EPS will decline 32.7%.

Although GS has performed impressively this year, beating consensus estimates, its declining growth rate could be of concern to investors.

Impressive financial data

During the third quarter, ended September 30, 2021, GS’s net interest income increased 44% year-on-year to $ 1.56 billion. The company’s net profit rose 63% from its value a year ago to $ 5.38 billion, while its EPS rose 66% year-on-year to $ 14.92 . In addition, its common Tier 1 capital was $ 93.3 billion, an increase of 4.4% for the quarter ended September 30, 2021.

Mixed profitability

GS’s 89.5% gross profit margin is 40.1% higher than the industry average of 63.9%. In addition, its ROA and net income margin of 1.54% and 38.2%, respectively, are 13.2% and 27% higher than industry averages. In addition, its 12-month rolling CAPEX / Sales of 8.5% is 427.2% above the industry average of 1.62%.

However, the 0.1% of the last 12 months of GS asset turnover rate is 78.4% below the industry average of 0.21%. In addition, its operating cash flow was negative $ 7.69 billion compared to the industry average of $ 136.14 million.

Up-to-date evaluations

In terms of a non-GAAP forward P / E, the stock is currently trading at 6.33x, which is 41.7% below the industry average of 10.86x. In addition, its non-GAAP PEG forward multiple of 0.66x is 30% lower than the industry average at 0.94x. And GS’s futures price / sell 2.16x is 33.8% lower than the industry average 3.27x.

POWR ratings reflect uncertainty

GS has an overall C rating, which equates to Neutral in our property POWR odds system. POWR scores are calculated taking into account 118 separate factors, each factor being weighted to an optimal degree.

Our proprietary scoring system also rates each stock against eight distinct categories. GS has a C rating for stability and quality. The stock’s 1.51 beta is in sync with the stability rating. In addition, GS’s mixed profitability is consistent with its level of Quality.

Out of the 22 shares rated A Investment brokerage industry, GS is ranked # 16.

Beyond what I stated above, we can see the GS ratings for growth, value, momentum and sentiment. here.

Final result

The company reported strong results in its final quarter due to increased financial transactions and activity in the capital markets. However, given analysts’ expectations for slower growth in the coming months, we believe investors should wait until the outlook for GS stabilizes before investing in the stock.

How does Goldman Sachs Group Inc. (GS) compare to its peers?

Although GS has an overall grade of C, one might want to consider its industry peers, Manning & Napier Inc. (MN) and the Piper Sandler companies (PIPR), which have an overall A rating (strong buy).


GS shares rose $ 3.54 (+ 0.95%) in pre-market on Tuesday. Year-to-date, GS has gained 43.39%, compared to a 22.88% increase in the benchmark S&P 500 over the same period.


About the Author: Pragya Pandey

Pragya is an equity research analyst and financial journalist with a passion for investing. In college, she majored in finance and is currently pursuing the CFA program and is a Level II candidate.

Following…

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Is Goldman Sachs Group A Good Financial Stock To Invest In? By StockNews https://purpleribbonproject.com/is-goldman-sachs-group-a-good-financial-stock-to-invest-in-by-stocknews/ Tue, 21 Dec 2021 08:00:00 +0000 https://purpleribbonproject.com/is-goldman-sachs-group-a-good-financial-stock-to-invest-in-by-stocknews/ [ad_1] © Reuters. Is Goldman Sachs Group A Good Financial Stock To Invest In? Shares of leading financial institution Goldman Sachs (GS) have gained 40.9% year-to-date thanks to its burgeoning investment banking division. However, analysts have raised concerns about the company’s growth prospects for the coming year as the Fed plans to tighten monetary policy. […]]]>


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© Reuters. Is Goldman Sachs Group A Good Financial Stock To Invest In?

Shares of leading financial institution Goldman Sachs (GS) have gained 40.9% year-to-date thanks to its burgeoning investment banking division. However, analysts have raised concerns about the company’s growth prospects for the coming year as the Fed plans to tighten monetary policy. So, is it worth adding the stock to your portfolio now? Let’s find out. World’s leading financial institution, Goldman Sachs Group Inc. (NYSE :), offers a wide range of financial services in the areas of investment banking, securities, investment management and consumer banking to a broad and diverse clientele that includes corporate, financial institutions, governments and individuals. Its action has gained 40.9% in progress since the beginning of the year thanks to various collaborations.

The company beat analysts’ revenue expectations by 16.6% and their EPS estimates by 47%, supported by strong mergers and acquisitions (M&A) performance, as well as a dynamic market for IPOs (IPO).

However, management cited a few key factors that could affect the company’s revenue growth in the coming months, including the increased likelihood of monetary policy tightening in the near term due to inflationary pressures. This would tend to deter companies from engaging in M&A activity. Additionally, GS shares were down 4.1% in price over the past month due to a market sell off over growing concerns over the omicron COVID-19 variant.

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Warning: Fusion media would like to remind you that the data contained in this site is not necessarily real time or accurate. All CFDs (stocks, indices, futures) and Forex prices are not provided by the exchanges but rather by the market makers, and therefore the prices may not be exact and may differ from the actual market price, which means that the prices are indicative and not suitable for trading purposes. Therefore, Fusion Media assumes no responsibility for any business losses that you may incur as a result of the use of such data.

Fusion media or anyone involved with Fusion Media will not accept any responsibility for any loss or damage resulting from reliance on any information, including data, quotes, graphics and buy / sell signals contained in this website. Please be fully informed about the risks and costs associated with trading in the financial markets, it is one of the riskiest forms of investing possible.

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Is the price of Discover Financial Stock reasonable? https://purpleribbonproject.com/is-the-price-of-discover-financial-stock-reasonable/ Fri, 12 Nov 2021 08:00:00 +0000 https://purpleribbonproject.com/is-the-price-of-discover-financial-stock-reasonable/ [ad_1] UKRAINE – 2021/04/16: In this photo, a Discover logo from Discover Financial Services is … [+] seen on a smartphone and a pc screen. (Photo Illustration by Pavlo Gonchar / SOPA Images / LightRocket via Getty Images) SOPA Images / LightRocket via Getty Images Discover Financial Stock (NYSE: DFS), the credit card giant, has […]]]>


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Discover Financial Stock (NYSE: DFS), the credit card giant, has gained 30% year-to-date, from its value of $ 91 at the start of 2020 to around $ 117 now, outperforming the S & P500, which has risen by 24% over the same period. In addition, the company’s net interest income and discount and interchange fees for the first nine months of 2021 improved 3% and 27% year-on-year, respectively.

There were two clear reasons for this: First, the relaxation of travel bans and Covid-19 restrictions have benefited consumer spending levels. Second, favorable financing costs.

But we think there are more benefits to come over the next few months.

Trefis estimates Discover the valuation of Financial at around $ 134 per share – around 14% above the current market price – based on a key opportunity and risk factor.

The opportunity we see is Discover financial income growth in subsequent quarters. The company generates more than 90% of its total revenues in the direct banking segment. Of which nearly 85% of the share comes from NII. The NII suffered a 2% year-on-year decline in 2020, due to lower outstanding loans and headwinds in interest rates. In addition, non-interest income was down 7% year-on-year due to lower discount and interchange fees. That limited the company’s revenue to $ 11.1 billion in 2020, down 3% year-on-year. That said, the trend has changed in fiscal 2021. The company recently released its third quarter results, beating consensus estimates for both revenue and earnings. It posted total revenue of $ 2.8 billion, up 2% year-on-year, thanks to 6% growth in NII and 26% in discount and interchange fees. Notably, sales were partially offset by – $ 167 million in unrealized gains / (losses) on equity investments. Overall, the NII and the discount and interchange fees both saw some improvement in the first three quarters of fiscal 2021. The cumulative NII for the first nine months improved by 3 % year-on-year, mainly due to favorable financing costs due to lower market rates and lower interest charges. In addition, discount and interchange fees increased 27% year-on-year over the same period, mainly due to higher transaction volumes.

Going forward, we expect the same trend to continue in the last quarter of fiscal 2021. Overall, this will likely allow Discover Financial to

DFS
revenue to reach $ 12.1 billion in fiscal year 2021. Our dashboard on Discover financial income offers more details on the business segments.

Discover Financial’s profitability figures suffered in 2020 due to a large build-up for credit losses and an increase in expenses as a% of revenue. However, the company reduced its provision figure in 2021, due to improved loan repayment capacity of its customers. In total, the adjusted net margin is expected to drop from 10% to around 43% during the year, leading to net profit of $ 5.2 billion. It should translate into EPS of $ 18.01, which when paired with a P / E multiple just below 8x will lead to a valuation of around $ 134.

Finally, how much should the market pay per dollar of Discover Financial profit? Well, to make almost $ 18.01 a year from a bank today, you would have to deposit around $ 1,801 into a savings account, which is about 100 times the desired earnings. At the current Discover Financial share price of around $ 117, we’re talking about a P / E multiple just below 7x. And we think a figure closer to 8x is appropriate.

However, credit card issuance and electronic payment solutions are emerging as a risky business today. Growth looks less promising and the short-term outlook is less than rosy. What is behind this?

Discover Financial is heavily dependent on net interest income and consumer spending levels. While the NII has seen some recovery due to falling financing costs, the company has experienced stagnant growth in overdue loan balances. This limited the growth potential of NII in the short term. In addition, levels of consumer spending have improved in recent quarters. However, any sudden increase in the number of Covid cases or any worsening economic conditions can undermine the current trend. In summary, we believe the Discover Financial stock is undervalued.

What if you were looking for a more balanced portfolio instead? here is a quality portfolio which has been regularly beating the market since 2016.

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Is Truist Financial stock a buy as the regional bank beats Q3 expectations? https://purpleribbonproject.com/is-truist-financial-stock-a-buy-as-the-regional-bank-beats-q3-expectations/ Fri, 15 Oct 2021 19:17:40 +0000 https://purpleribbonproject.com/is-truist-financial-stock-a-buy-as-the-regional-bank-beats-q3-expectations/ [ad_1] Shares of Truist Financial Corp (NYSE: TFC) jumped nearly 1% on Friday after its latest quarterly results were announced. The company reported strong third quarter revenue and earnings ahead of the market opening, beating analysts’ expectations. Truist posted non-GAAP FQ3 earnings per share of $ 1.42, beating the average analyst expectations of $ 1.20. […]]]>


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Shares of Truist Financial Corp (NYSE: TFC) jumped nearly 1% on Friday after its latest quarterly results were announced. The company reported strong third quarter revenue and earnings ahead of the market opening, beating analysts’ expectations.

Truist posted non-GAAP FQ3 earnings per share of $ 1.42, beating the average analyst expectations of $ 1.20. Additionally, the company’s GAAP EPS of $ 1.20 exceeded Street’s estimate of $ 1.09, while quarterly revenue of $ 5.63 billion was $ 100 million higher. dollars estimated despite marginal growth of 0.5% year-on-year.

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Shares of Truist Financial have risen almost 30% this year and over 45% in the past 12 months.

Is it time to buy TFC shares?

From an investment perspective, Truist Financial stock is trading at an attractive 12-month P / E of 15.98 and an even better forward P / E of 12.45. Therefore, value investors might find stock to be an attractive option for their portfolios.

However, analysts expect the Charlotte, NC-based bank’s earnings per share to decline by more than 17% this year, before falling further 4.62% next year. Therefore, growth investors could opt for alternatives in the market.

Nonetheless, TFC’s exciting dividend yield of 3.14% may attract the attention of dividend investors.

Source – TradingView

Is a downturn imminent?

Technically, shares of Truist Financial appear to be trading within an ascending channel formation in the intraday chart. As a result, the stock price moved closer to the 14-day RSI overbought conditions, creating an opportunity for a short-term pullback.

Therefore, investors could target potential withdrawals at around $ 58.82, or less at $ 56.92, while $ 62.58 is a crucial support area.

It might be time to short sell TFC shares

In summary, while Truist Financial shares are still trading at lucrative valuation multiples after the strong quarterly performance, its growth prospects are disappointing.

TFC stock is up more than 13% since September 21, pushing the stock price closer to overbought conditions. Therefore, the stock looks poised for a short-term pullback before the rally continues.

Where to buy right now

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Which financial stock is a better buy? By StockNews https://purpleribbonproject.com/which-financial-stock-is-a-better-buy-by-stocknews/ Thu, 23 Sep 2021 07:00:00 +0000 https://purpleribbonproject.com/which-financial-stock-is-a-better-buy-by-stocknews/ © Reuters. LoanDepot vs. CURO Group Holdings: Which Financial Stock is a Better Buy? The Federal Reserve announced yesterday that it may raise interest rates next year. And because a higher rate environment helps the financial sector, LoanDepot (LDI) and CURO Group Holdings (CURO) stand to benefit. But which of these two stocks is a […]]]>

© Reuters. LoanDepot vs. CURO Group Holdings: Which Financial Stock is a Better Buy?

The Federal Reserve announced yesterday that it may raise interest rates next year. And because a higher rate environment helps the financial sector, LoanDepot (LDI) and CURO Group Holdings (CURO) stand to benefit. But which of these two stocks is a better buy now? Read on to find out more. Additionally, its technology platform, mello, works across all aspects of its business, including lead generation, data creation and integration. By comparison, diversified consumer finance company CURO Group Holdings Corp. (CURO) offers unsecured installment loans, secured installment loans, open-ended loans and single payment loans. CURO is based in Wichita, Kans.

Even though interest rates have been kept close to zero for an extended period, the financial sector rebounded significantly earlier this year as the economy gradually recovered on the back of strong progress on the vaccine front. COVID-19. Additionally, following yesterday’s Federal Reserve announcement, half of US Federal Reserve policymakers now expect to start raising interest rates next year, which should bode well for the financial sector. Thus, LDI and CURO could benefit.

LDI is down 12.9% in price over the past month, while CURO is down 1%. Additionally, in terms of past six month performance, CURO is the clear winner with gains of 9.5% versus LDI’s negative returns.

Continue reading on StockNews

Warning: Merged media would like to remind you that the data contained in this site is not necessarily in real time or exact. All prices for CFDs (stocks, indices, futures) and Forex are not provided by exchanges but rather by market makers, and therefore prices may not be accurate and may differ from the actual market price, which which means that the prices are indicative and not suitable for commercial purposes. Therefore, Fusion Media assumes no responsibility for any business losses you may incur due to the use of this data.

Merged media or anyone involved with Fusion Media will accept no liability for any loss or damage resulting from reliance on the information, including data, quotes, charts and buy/sell signals contained in this website . Please be fully informed of the risks and costs associated with trading in the financial markets, it is one of the riskiest forms of investment possible.

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Raymond James Financial shares are down more than 34% today https://purpleribbonproject.com/raymond-james-financial-shares-are-down-more-than-34-today/ Wed, 22 Sep 2021 05:44:59 +0000 https://purpleribbonproject.com/raymond-james-financial-shares-are-down-more-than-34-today/ [ad_1] (VIANEWS) – Actions of Raymond James Financial (NYSE Composite: RJF) fell 34.36% to $ 85.90 as of 1:43 a.m. EST Wednesday, following the downtrend from the last session. NYSE Composite jumped 0.1% to $ 16,184.50, after five consecutive sessions of losses. It seems, so far, a somewhat bullish trend trading session today. Raymond James […]]]>


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(VIANEWS) – Actions of Raymond James Financial (NYSE Composite: RJF) fell 34.36% to $ 85.90 as of 1:43 a.m. EST Wednesday, following the downtrend from the last session. NYSE Composite jumped 0.1% to $ 16,184.50, after five consecutive sessions of losses. It seems, so far, a somewhat bullish trend trading session today.

Raymond James Financial’s latest close was $ 139.04, 2.86% below its 52-week high of $ 143.14.

Volume

The latest volume reported today for Raymond James Financial is 420,598, which is 19.61% lower than its average volume of 523,238.

Raymond James Financial sales

Raymond James Financial’s sales growth is 21.2% for the current quarter and 22.8% for the next. The company’s growth estimates for the current quarter and the next are 39.9% and 10.3%, respectively.

Raymond James Financial turnover

The year-over-year quarterly revenue growth rose 25.7% to $ 8.46 billion for the past twelve months.

Upper and lower annual value of Raymond James Financial shares

Raymond James Financial stock is valued at $ 85.90 at 1:43 am EST, well below its 52-week high of $ 143.14 and well above its 52-week low of $ 67.66 .

Raymond James Financial moving average

Raymond James Financial’s value is well below its 50-day moving average of $ 136.32 and well below its 200-day moving average of $ 130.46.

More news on Raymond James Financial (RJF).

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