To The Moon

On Fri, 13 Oct 2023 — $JPMorgan Chase(JPM)$, $Wells Fargo(WFC)$ and $Citigroup(C)$ have released their Q3 2023 earnings. Despite all the challenges faced by the financial sector, the 3 banks managed to report profits. JPMorgan Chase & Co. reported a profit of $13.15 billion, or $4.33 a share, YoY. Wells Fargo & Company reported a profit of $6.04 billion, or $1.38 a share, YoY. Citigroup Inc.reported a profit of $5.2 billion, or $2.85 a share, YoY. On Tue, 17 Oct 2023 $Bank of America(BAC)$ will be reporting its Q3 2023 quarterly earnings. I came across a post by Barron (see below), that I think is insightful and reminds us to always, always not to look at things on the surface. Bank of America (BAC), one of the largest banks in the US faces a lot of challenges and opportunities. It is not doing well compared to its peers, in terms of profitability and growth, due to BAC’s heavy exposure to the bond market, that has suffered from low interest rates and inflation. BAC is trading at only 8.2 times earnings, a -15% discount to JPMorgan’s 9.6 times. The concern is the bank’s large holding of low-yielding mortgage securities, among other bonds, that have caused it to suffer unrealized losses of -$105.8 billion at the end of Q2 2023. Those losses likely increased by $10 billion to $15 billion during Q3 2023. It’s the one issue that continues to hang over everything at BAC. Does this sound all too familiar like the Silicon Valley Bank’s fate where the collapsed bank had overloaded on bonds when it was awashed with excess deposits? Due to its market capitalization and size, BAC has more leeway to get out of the trough and improve its performance that it currently faces. This includes: Diversifying its revenue sources. Costs cut. Focus on its assets — customers. Return capital to shareholders, in the form of higher dividends. Invest in Digital banking. Bank of America still has a chance to regain its position as a leading bank. However, it needs to act fast and decisively. For Bank of America’s impending Q3 2023 earnings on Tue, 17 Oct 2023: The impact of higher interest rates will show up it the report. Wall Street expects BAC to report a profit of $0.83 cents a share, up +2.50% from $0.81 cents YoY. It is still growth, but not much, especially when compared to JPMorgan, which grew earnings by +39%, and Wells Fargo, whose earnings rose +74%. Do you think you will pay extra attention to its non-performing bonds investment in BAC’s coming report? Do you think Bank of America will be able to climb out of the “hell hole” anytime soon? Please give a “LIKe”, “Share” and “Re-post” ok. Thanks. Rating is very important (to me). Do consider “Follow me” and get firsthand read of my daily new post/s ok. Thanks. @Daily_Discussion @TigerPM @TigerStars @Tiger_SG @TigerEvents