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What's in Store for Huntington (HBAN) in Q4 Earnings?
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Huntington Bancshares Incorporated (HBAN - Free Report) is scheduled to report fourth-quarter and 2017 results on Jan 23, before the opening bell. The company’s revenues and earnings are projected to grow year over year.
The company’s fourth-quarter results are expected to be supported by robust organic growth and benefits from the FirstMerit acquisition (completed in Aug 2016).
Rising interest rates might have worked in favor too. Though flatter yield curve offsets the benefits to some extent, pressure on Huntington’s net interest margin is likely to ease slightly from the three rate hikes in 2017. The Zacks Consensus Estimate of $1.10 billion for revenues indicates a 3.3% year-over-year improvement.
Huntington has a decent earnings surprise history. It surpassed the earnings estimates in two of the trailing four quarters, with an average positive surprise of 4.4%.
Huntington Bancshares Incorporated Price and EPS Surprise
Last quarter, the company’s earnings were in line with the Zacks Consensus Estimate. Higher revenues, continual growth in both loan and deposit balances, and lower provisions were among the positives. However, higher net charge-offs were the primary headwind.
Activities of Huntington during the fourth quarter were inadequate to win analysts’ confidence. Thus, over the last seven days, the Zacks Consensus Estimate for the quarter’s earnings has remained stable at 26 cents. Nevertheless, it reflects a year-over-year improvement of 8.3%.
Notably, Huntington’s fundamental strength has helped its shares gain 14.4% in the past six months, outperforming the 12.3% growth recorded by the industry.
Will the stock’s rally continue post fourth-quarter earnings release? Let’s see how things are shaping up.
Earnings Whispers
According to our proven model, we cannot conclusively predict if Huntington will beat the Zacks Consensus Estimate this time. That’s because, it doesn’t have the right combination of two key ingredients — positive Earnings ESP and a Zacks Rank #3 (Hold) or better — to increase the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks ESP: The company has an Earnings ESP of 0.00%.
Zacks Rank: Huntington currently carries a Zacks Rank #2 (Buy), which increases the predictive power of ESP. However, we also need a positive ESP to be confident of an earnings beat.
Factors That Might Influence Q4 Results
Revenues Might Grow: Revenues are likely to improve in line with the company’s long-term financial goals, supported by synergies from the FirstMerit acquisition. Also, increasing net interest margin and a decent loan growth during the quarter will enhance net interest income. The Zacks Consensus Estimate for average interest-earning assets of $93.9 billion reflects 1.1% sequential growth.
Further, management expects the total revenue for 2017 to grow about 23% year over year.
Expenses Likely to Increase: Management believes that all the cost savings related to the acquisition of FirstMerit have been achieved in the last quarter. They have now shifted their focus to revenue growth that is likely to push up expenses in this quarter. For full-year 2017, the company expects the non-interest expense growth to be nearly 13%.
Credit Quality Might Deteriorate: The Zacks Consensus Estimate for allowance for loan and lease losses of $686 million shows a 1.6% increase from the last quarter. Also, net charge-offs are projected to be $43.1 million, reflecting a marginal sequential increase.
Stocks That Warrant a Look
Here are some other stocks you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.
The Earnings ESP for Legg Mason, Inc. is +0.18% and the stock has a Zacks Rank #1 (Strong Buy). The company is scheduled to release December quarter-end results on Jan 24. You can see the complete list of today’s Zacks #1 Rank stocks here.
Santander Consumer USA Holdings Inc.’s Earnings ESP is +1.31% and it carries a Zacks Rank of 3. The company is expected to release fourth-quarter results on Jan 31.
T. Rowe Price Group, Inc. (TROW - Free Report) is slated to release results on Jan 30. The company has an Earnings ESP of +1.49% and carries a Zacks Rank of 2.
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With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
What's in Store for Huntington (HBAN) in Q4 Earnings?
Huntington Bancshares Incorporated (HBAN - Free Report) is scheduled to report fourth-quarter and 2017 results on Jan 23, before the opening bell. The company’s revenues and earnings are projected to grow year over year.
The company’s fourth-quarter results are expected to be supported by robust organic growth and benefits from the FirstMerit acquisition (completed in Aug 2016).
Rising interest rates might have worked in favor too. Though flatter yield curve offsets the benefits to some extent, pressure on Huntington’s net interest margin is likely to ease slightly from the three rate hikes in 2017. The Zacks Consensus Estimate of $1.10 billion for revenues indicates a 3.3% year-over-year improvement.
Huntington has a decent earnings surprise history. It surpassed the earnings estimates in two of the trailing four quarters, with an average positive surprise of 4.4%.
Huntington Bancshares Incorporated Price and EPS Surprise
Huntington Bancshares Incorporated Price and EPS Surprise | Huntington Bancshares Incorporated Quote
Last quarter, the company’s earnings were in line with the Zacks Consensus Estimate. Higher revenues, continual growth in both loan and deposit balances, and lower provisions were among the positives. However, higher net charge-offs were the primary headwind.
Activities of Huntington during the fourth quarter were inadequate to win analysts’ confidence. Thus, over the last seven days, the Zacks Consensus Estimate for the quarter’s earnings has remained stable at 26 cents. Nevertheless, it reflects a year-over-year improvement of 8.3%.
Notably, Huntington’s fundamental strength has helped its shares gain 14.4% in the past six months, outperforming the 12.3% growth recorded by the industry.
Will the stock’s rally continue post fourth-quarter earnings release? Let’s see how things are shaping up.
Earnings Whispers
According to our proven model, we cannot conclusively predict if Huntington will beat the Zacks Consensus Estimate this time. That’s because, it doesn’t have the right combination of two key ingredients — positive Earnings ESP and a Zacks Rank #3 (Hold) or better — to increase the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks ESP: The company has an Earnings ESP of 0.00%.
Zacks Rank: Huntington currently carries a Zacks Rank #2 (Buy), which increases the predictive power of ESP. However, we also need a positive ESP to be confident of an earnings beat.
Factors That Might Influence Q4 Results
Revenues Might Grow: Revenues are likely to improve in line with the company’s long-term financial goals, supported by synergies from the FirstMerit acquisition. Also, increasing net interest margin and a decent loan growth during the quarter will enhance net interest income. The Zacks Consensus Estimate for average interest-earning assets of $93.9 billion reflects 1.1% sequential growth.
Further, management expects the total revenue for 2017 to grow about 23% year over year.
Expenses Likely to Increase: Management believes that all the cost savings related to the acquisition of FirstMerit have been achieved in the last quarter. They have now shifted their focus to revenue growth that is likely to push up expenses in this quarter. For full-year 2017, the company expects the non-interest expense growth to be nearly 13%.
Credit Quality Might Deteriorate: The Zacks Consensus Estimate for allowance for loan and lease losses of $686 million shows a 1.6% increase from the last quarter. Also, net charge-offs are projected to be $43.1 million, reflecting a marginal sequential increase.
Stocks That Warrant a Look
Here are some other stocks you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.
The Earnings ESP for Legg Mason, Inc. is +0.18% and the stock has a Zacks Rank #1 (Strong Buy). The company is scheduled to release December quarter-end results on Jan 24. You can see the complete list of today’s Zacks #1 Rank stocks here.
Santander Consumer USA Holdings Inc.’s Earnings ESP is +1.31% and it carries a Zacks Rank of 3. The company is expected to release fourth-quarter results on Jan 31.
T. Rowe Price Group, Inc. (TROW - Free Report) is slated to release results on Jan 30. The company has an Earnings ESP of +1.49% and carries a Zacks Rank of 2.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>