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Royal Bank of Canada (RY) Q4 Earnings: What's in Store?
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The Royal Bank of Canada (RY - Free Report) is scheduled to report fourth-quarter fiscal 2020 (ended Oct 31, 2020) results on Dec 2. While revenues are expected to have improved year over year, earnings might have declined.
In the last reported quarter, the company witnessed higher expenses and provisions. However, higher revenues, along with elevated loans and deposit balances, were positives.
The company has a decent earnings surprise history. Its earnings surpassed the consensus estimate in two of the trailing four quarters, the beat being 0.25%, on average.
The Zacks Consensus Estimate for Royal Bank of Canada’s earnings of $1.54 for the to-be-reported quarter has been revised north over the past 30 days. Nevertheless, it indicates a fall of 8.3% from the year-ago reported figure.
Factors to Impact Q4 Results
Lower Net Interest Income: Lending was subdued during the quarter as the virus outbreak resulted in a decline in loan demand amid economic slowdown. This, along with low interest rates, is likely to have impeded Royal Bank of Canada’s interest income growth.
Higher Trading Revenues: A persistent rise in market volatility on account of the coronavirus outbreak was seen during the quarter. The pandemic and concerns surrounding its impact on the economy weighed on investor sentiments. With a spike in volatility and higher client activities, the lender’s trading revenues are likely to have witnessed a boost in the to-be-reported quarter.
Controlled Costs: The company’s efforts to keep expenses on track are expected to have benefited it in this quarter as well.
What the Zacks Model Predicts
Our proven model does not conclusively predict an earnings beat for Royal Bank of Canada this time around. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and 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 Royal Bank of Canada is 0.00%.
Zacks Rank: The company currently carries a Zacks Rank #3.
UBS Group AG (UBS - Free Report) has witnessed a 19.7% upward earnings estimate revision for the current year in the past 60 days. This Zacks Rank #2 stock has gained 34% over the past six months.
The Bank of N.T. Butterfield & Son Limited’s (NTB - Free Report) 2020 earnings estimates have moved 6.2% north over the past 60 days. The company’s shares have rallied 33.7% over the past six months. It carries a Zacks Rank of 2 at present.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Royal Bank of Canada (RY) Q4 Earnings: What's in Store?
The Royal Bank of Canada (RY - Free Report) is scheduled to report fourth-quarter fiscal 2020 (ended Oct 31, 2020) results on Dec 2. While revenues are expected to have improved year over year, earnings might have declined.
In the last reported quarter, the company witnessed higher expenses and provisions. However, higher revenues, along with elevated loans and deposit balances, were positives.
The company has a decent earnings surprise history. Its earnings surpassed the consensus estimate in two of the trailing four quarters, the beat being 0.25%, on average.
Royal Bank Of Canada Price and EPS Surprise
Royal Bank Of Canada price-eps-surprise | Royal Bank Of Canada Quote
The Zacks Consensus Estimate for Royal Bank of Canada’s earnings of $1.54 for the to-be-reported quarter has been revised north over the past 30 days. Nevertheless, it indicates a fall of 8.3% from the year-ago reported figure.
Factors to Impact Q4 Results
Lower Net Interest Income: Lending was subdued during the quarter as the virus outbreak resulted in a decline in loan demand amid economic slowdown. This, along with low interest rates, is likely to have impeded Royal Bank of Canada’s interest income growth.
Higher Trading Revenues: A persistent rise in market volatility on account of the coronavirus outbreak was seen during the quarter. The pandemic and concerns surrounding its impact on the economy weighed on investor sentiments. With a spike in volatility and higher client activities, the lender’s trading revenues are likely to have witnessed a boost in the to-be-reported quarter.
Controlled Costs: The company’s efforts to keep expenses on track are expected to have benefited it in this quarter as well.
What the Zacks Model Predicts
Our proven model does not conclusively predict an earnings beat for Royal Bank of Canada this time around. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and 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 Royal Bank of Canada is 0.00%.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks to Consider
Earnings estimates for the current year for Bank of Montreal (BMO - Free Report) have moved 3.4% north over the past 60 days. The company’s shares have gained 47% over the past six months. It currently has a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
UBS Group AG (UBS - Free Report) has witnessed a 19.7% upward earnings estimate revision for the current year in the past 60 days. This Zacks Rank #2 stock has gained 34% over the past six months.
The Bank of N.T. Butterfield & Son Limited’s (NTB - Free Report) 2020 earnings estimates have moved 6.2% north over the past 60 days. The company’s shares have rallied 33.7% over the past six months. It carries a Zacks Rank of 2 at present.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>