本帖最后由 cellphone 于 2012-10-11 11:24 编辑
JP Morgan, Wells Fargo to Lead Off Bank Earnings: Expect Decent Numbers, Great Theater
JP Morgan (JPM) and Wells Fargo (WFC) both report third-quarter earnings tomorrow morning. Barring a calamitous miss, the numbers have seldom mattered less for either company. The focus of the Street will likely be on how each company is handling the pressures being put on them by enforcement agencies. Wells Fargo was charged with mortgage fraud earlier this week. JPM was faced with a similar complaint related to actions at Bear Stearns which JPM purchased during the financial crisis. Adding to pain for JPM, the NYTimes.com reported this morning that authorities are building a case against the bank related to the infamous London Whale incident. With the financials having already gained over 20% this year the obvious play is to take profits and wait for the storms to pass.
Simon Baker of Baker Avenue Asset Management says it could pay to stick with the banks, particularly the two reporting on Friday. "JPM Morgan and Wells are probably the soundest of the banks," he says in the attached clip. The housing recovery has likely been a meaningful tailwind for Wells, and JPM's vaunted "fortress balance sheet" isn't going to crumble under lawsuits or whale malfeasance.
The balance sheets are important but Baker is more concerned with the tone of the conference call. JPM CEO Jamie Dimon is known for his blunt, alpha-dog nature when talking to the Street. The last time he was caught off guard in public was on May 10th when the losses in JPM's London offices first came to light. It's not a coincidence that JPM tumbled the next day and started to recover in earnest after Mr. Dimon recaptured his mojo on the July 13th earnings call.
No one thinks the suits will go all the way to the top of either JPM or Wells. The cases are unlikely to even go to trial. The case has long since gone cold on the housing crisis and everyone involved in JPM's trading scandal has been fired or "resigned" already. If the government wanted to push for prison sentences or civil suits on the housing crisis they should have done so in 2010 or even last year. Charges being mulled in public less than a month before the presidential election smacks more of political grandstanding than a quest for justice.
Baker thinks it's too soon to buy the banks but he's hungry for a dip after the reports. Even with how far the stocks have come, the values remain compelling and the headwinds in JPM and Wells' core businesses seem to be easing. The best course of action for tomorrow may be having some cash on hand to buy on a pullback and popcorn ready to munch on during the conference call dramatics. |
发表于 2012-10-11 12:22
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