Big Banks Expected to Post Higher Profits as Shares Surge

Dow Jones11:30

Shares of the largest U.S. banks have surged to all-time highs or to their highest levels in decades, a run that has both rewarded investors and introduced a high bar to clear when they report earnings next week.

JPMorgan Chase is set to release fourth-quarter earnings on Tuesday, followed by Bank of America, Wells Fargo, and Citigroup the next day. On Thursday, Morgan Stanley and Goldman Sachs will report.

Each firm’s stock has hit a record high this month, except for Citi’s, which recently jumped to its highest level since 2008. The S&P 500’s financials sector climbed to a record high last Monday.

“With strong stock performance in 2025, bank stocks could be choppy into [fourth-quarter] earnings if outlooks are moderate, even if these are out of caution given high expectations,” J.P. Morgan Securities analysts led by Vivek Juneja wrote Jan. 6 in a report to clients.

A mix of drivers have powered the sector, which is sensitive to interest rates and the economy.

The broader market’s rally is benefiting banks’ wealth- and asset-management businesses. Solid consumer spending and credit, against a surprisingly resilient economy, have translated to stable loan portfolios. The Trump administration, meanwhile, is carrying out its Wall Street-friendly work to chip away at key financial regulations, lifting growth expectations for large and small banks.

Even as concerns about credit quality and banks’ lending to nonbank financial firms spread in late 2025, raising questions about lending standards, banks’ bottom lines should keep improving. Analysts expect profits to have risen across the group, with the exception of Goldman, which is forecast to report lower per-share earnings from a year ago.

“Overall, we anticipate that U.S. banks will continue to perform well given the generally benign operating environment, although this is slightly offset by some signs of a softening labor market, weakening consumer sentiment, and ongoing inflationary pressures,” Morningstar DBRS analysts wrote in a recent banking sector outlook.

Here is a snapshot of Wall Street’s expectations, per FactSet data, compared with the banks’ results from the fourth quarter of 2024.

JPMorgan Chase

Earnings per share of $4.91 vs. $4.81

Revenue of $46.17 billion vs. $42.77 billion

Bank of America

Earnings per share of 96 cents vs. 82 cents

Revenue of $27.7 billion vs. $25.3 billion

Citigroup

Earnings per share of $1.67 vs. $1.34

Revenue of $20.45 billion vs. $19.58 billion

Wells Fargo

Earnings per share of $1.66 vs. $1.43

Revenue of $21.65 billion vs. $20.38 billion

Morgan Stanley

Earnings per share of $2.42 vs. $2.22

Revenue of $17.7 billion vs. $16.2 billion

Goldman Sachs

Earnings per share of $11.62 vs. $11.95

Revenue of $14.49 billion vs. $13.87 billion

At the request of the copyright holder, you need to log in to view this content

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment