We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Low Rates, Muted Loan Growth to Mar Zions' (ZION) Q3 Earnings
Read MoreHide Full Article
Zions Bancorporation (ZION - Free Report) is scheduled to report third-quarter 2020 results on Oct 19, after market close. The overall lending scenario was not very impressive in the third quarter. In fact, commercial and industrial loan balances (constituting a large part of Zions’ loan portfolio), which witnessed significant growth in the second quarter, witnessed a considerable decline in the to-be-reported quarter.
Moreover, the Zacks Consensus Estimate for Zions’ average interest-earning assets for the third quarter is pegged at $70.8 billion, which indicates a marginal decline from the previous quarter’s reported number.
Thus, owing to muted loan growth along with near-zero interest rates, Zions’ net interest income (NII) — which is its main revenue component — is not expected to have improved in the quarter. The consensus estimate for NII of $559 million indicates a 1% decline sequentially.
Now, let’s have a look at the other key factors that are likely to have impacted Zions’ third-quarter performance.
Fee Revenues: Continued stay-at-home orders led to people buying new homes, which resulted in a rise in mortgage originations in the third quarter. Moreover, there was a substantial rise in refinancing activities, owing to historically low mortgage rates. Owing to these factors, the company’s loan sales and servicing income are likely to have improved in the quarter.
Moreover, commercial account fee is expected to have been positively impacted. The consensus estimate for the same is pegged at $30.46 million, which indicates a rise of 1.5% sequentially.
Although overall consumer banking activities were strained in the third quarter due to the continuation of economic slowdown because of the pandemic, consumer spending witnessed some improvement from the first half of the year. Thus, Zions’ card fee is expected to have improved in the quarter. The consensus estimate for card fees of $20.18 million indicates a 6.2% rise sequentially.
The Zacks Consensus Estimate for retail and business banking fees of $16.36 million for the quarter indicates a 9.1% rise from the prior quarter. Further, the Zacks Consensus Estimate for wealth management and trust fees of $15.60 million indicates a 4% rise from the previous quarter.
Owing to an expected rise in almost all components of customer-related fee, total customer-related fee (accounting for more than 85% of total fee revenues) is expected to have been positively impacted. The Zacks Consensus Estimate for the same is pegged at $134 million for the third quarter, which indicates an increase of 3.1% sequentially.
Notably, dividend and other income are likely to have risen in the quarter as well. The Zacks Consensus Estimate for the same of $4.75 million indicates an improvement of 58.3% from the prior quarter.
Therefore, driven by an increase in total customer-related fee as well as dividend income, total fee revenues are likely to have improved in the quarter. The consensus estimate for total non-interest income for the third quarter is pegged at $138 million, which indicates a rise of 17.9% on a sequential basis.
Expenses: Zions has been witnessing a persistent rise in operating expenses over the past few years. In fact, as the company continues to invest in franchise, overall costs are expected to have remained elevated in the third quarter as well.
Asset Quality: The Zacks Consensus Estimate for total non-performing loans for the third quarter is pegged at $375 million, suggesting a 10.6% rise from the prior quarter.
What Our Quantitative Model Predicts
According to our quantitative model, chances of Zions beating the Zacks Consensus Estimate this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Zions is +5.38%.
Zacks Rank: The company currently carries a Zacks Rank #3.
Q3 Earnings & Sales Growth Expectations
The Zacks Consensus Estimate for Zions’ earnings is pegged at 86 cents for the to-be-reported quarter, which suggests a decline of 26.5% year over year. The figure has been revised 8.9% upward over the past seven days.
The consensus estimate for the company’s sales is pegged at $708.85 million, which indicates a marginal decline from the prior-year reported figure.
Here are some other finance stocks that you may want to consider as these too have the right combination of elements to post an earnings beat in their upcoming releases, per our model.
Huntington Bancshares Incorporated (HBAN - Free Report) is set to release earnings figures on Oct 22. The company, which carries a Zacks Rank of 3 at present, has an Earnings ESP of +2.88%.
The Earnings ESP for Civista Bancshares, Inc. (CIVB - Free Report) is +26.31% and the company carries a Zacks Rank #2 (Buy), currently. It is scheduled to report quarterly numbers on Oct 23.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
Image: Bigstock
Low Rates, Muted Loan Growth to Mar Zions' (ZION) Q3 Earnings
Zions Bancorporation (ZION - Free Report) is scheduled to report third-quarter 2020 results on Oct 19, after market close. The overall lending scenario was not very impressive in the third quarter. In fact, commercial and industrial loan balances (constituting a large part of Zions’ loan portfolio), which witnessed significant growth in the second quarter, witnessed a considerable decline in the to-be-reported quarter.
Moreover, the Zacks Consensus Estimate for Zions’ average interest-earning assets for the third quarter is pegged at $70.8 billion, which indicates a marginal decline from the previous quarter’s reported number.
Thus, owing to muted loan growth along with near-zero interest rates, Zions’ net interest income (NII) — which is its main revenue component — is not expected to have improved in the quarter. The consensus estimate for NII of $559 million indicates a 1% decline sequentially.
Now, let’s have a look at the other key factors that are likely to have impacted Zions’ third-quarter performance.
Fee Revenues: Continued stay-at-home orders led to people buying new homes, which resulted in a rise in mortgage originations in the third quarter. Moreover, there was a substantial rise in refinancing activities, owing to historically low mortgage rates. Owing to these factors, the company’s loan sales and servicing income are likely to have improved in the quarter.
Moreover, commercial account fee is expected to have been positively impacted. The consensus estimate for the same is pegged at $30.46 million, which indicates a rise of 1.5% sequentially.
Although overall consumer banking activities were strained in the third quarter due to the continuation of economic slowdown because of the pandemic, consumer spending witnessed some improvement from the first half of the year. Thus, Zions’ card fee is expected to have improved in the quarter. The consensus estimate for card fees of $20.18 million indicates a 6.2% rise sequentially.
The Zacks Consensus Estimate for retail and business banking fees of $16.36 million for the quarter indicates a 9.1% rise from the prior quarter. Further, the Zacks Consensus Estimate for wealth management and trust fees of $15.60 million indicates a 4% rise from the previous quarter.
Owing to an expected rise in almost all components of customer-related fee, total customer-related fee (accounting for more than 85% of total fee revenues) is expected to have been positively impacted. The Zacks Consensus Estimate for the same is pegged at $134 million for the third quarter, which indicates an increase of 3.1% sequentially.
Notably, dividend and other income are likely to have risen in the quarter as well. The Zacks Consensus Estimate for the same of $4.75 million indicates an improvement of 58.3% from the prior quarter.
Therefore, driven by an increase in total customer-related fee as well as dividend income, total fee revenues are likely to have improved in the quarter. The consensus estimate for total non-interest income for the third quarter is pegged at $138 million, which indicates a rise of 17.9% on a sequential basis.
Expenses: Zions has been witnessing a persistent rise in operating expenses over the past few years. In fact, as the company continues to invest in franchise, overall costs are expected to have remained elevated in the third quarter as well.
Asset Quality: The Zacks Consensus Estimate for total non-performing loans for the third quarter is pegged at $375 million, suggesting a 10.6% rise from the prior quarter.
What Our Quantitative Model Predicts
According to our quantitative model, chances of Zions beating the Zacks Consensus Estimate this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Zions is +5.38%.
Zacks Rank: The company currently carries a Zacks Rank #3.
Q3 Earnings & Sales Growth Expectations
The Zacks Consensus Estimate for Zions’ earnings is pegged at 86 cents for the to-be-reported quarter, which suggests a decline of 26.5% year over year. The figure has been revised 8.9% upward over the past seven days.
The consensus estimate for the company’s sales is pegged at $708.85 million, which indicates a marginal decline from the prior-year reported figure.
Zions Bancorporation, N.A. Price and EPS Surprise
Zions Bancorporation, N.A. price-eps-surprise | Zions Bancorporation, N.A. Quote
Other Stocks That Warrant a Look
Here are some other finance stocks that you may want to consider as these too have the right combination of elements to post an earnings beat in their upcoming releases, per our model.
The Earnings ESP for CullenFrost Bankers, Inc. (CFR - Free Report) is +2.61% and the company carries a Zacks Rank of 3, at present. It is slated to report quarterly results on Oct 29. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Huntington Bancshares Incorporated (HBAN - Free Report) is set to release earnings figures on Oct 22. The company, which carries a Zacks Rank of 3 at present, has an Earnings ESP of +2.88%.
The Earnings ESP for Civista Bancshares, Inc. (CIVB - Free Report) is +26.31% and the company carries a Zacks Rank #2 (Buy), currently. It is scheduled to report quarterly numbers on Oct 23.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
Download Marijuana Moneymakers FREE >>