Saturday, June 3, 2023

JP Morgan and Goldman Sachs Blow Past Estimates


Key Talking Points:

  • JP Morgan reports earnings per share of $3.78
  • Goldman Sachs boosted by investment banking decision, earnings of $15.02

US Banks have kicked off the Q2 earnings season and it’s been another impressive quarter for both JP Morgan and Goldman Sachs, which have exceeded market expectations once again.

JP Morgan: net revenues for the second quarter were up to $31.4 billion, exceeding expectations of $29.9 billion. Earnings jumped up to $3.78 per share boosted mostly by the equity division, which is up 13%, compared to the fixed income division which is down 44%. The bank has also benefited from a release of provision for credit losses as borrowers have held up better than previously expected.

JP Morgan shares are sitting on $158 per share prior to market open having bounced back in Monday’s session prior to the release of earnings. The shares are up 66% from the same time last year, beating the S&P performance of 39% in the same quarter.

JP Morgan Daily Chart

Earnings Season: JP Morgan and Goldman Sachs Blow Past Estimates

Source: Refinitiv

Goldman Sachs: net revenues were $15.39 billion in the second quarter, a 16% increase from the same time last year. The biggest increase in revenue came from the investment banking division, which was 36% higher than Q2 2020 coming in at $3.61 billion, boosted by a strong IPO market. The biggest drop was seen in the global markets division, falling 32% from the previous year at $4.90 billion. Earnings per share in Q2 are $15.02, with an increased dividend of $2 per share. The bank has warned that despite economic recovery underway, their clients still face challenges in overcoming the pandemic.

Goldman Sachs shares are trading at $380.5 ahead of market open bouncing back from $355 last Thursday. Shares are up 35% year on year having reached an all-time high of $393 back in June.

Goldman Sachs Daily Chart

Earnings Season: JP Morgan and Goldman Sachs Blow Past Estimates

Source: Refinitiv

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— Written by Daniela Sabin Hathorn, Market Analyst

Follow Daniela on Twitter @HathornSabin

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