Analysts expect a strong second-quarter earnings report from Bank of America Corp. (NYSE:BAC) on Friday.
Predictions say Bank of America is likely to report a profit of between 21 cents and 26 cents a share, but there are several moving pieces that could affect the bank's results.
Among that laundry list of factors are:
- loan write-offs
- the acquisition of Merrill Lynch & Co.
- a special assessment of $900 million from the Federal Deposit Insurance Corp.
- mark-to-market hits on its $2 billion in debt
- mark-to-market expenses on $1.5 billion counterparty insurance agreements
The bank will also take a hit on its consumer portfolio due to unemployment and credit defaults.
SmartMoney did a roundup of analysts comments.
- Meredith Whitney said on CNBC that Bank of America was among the cheapest of the big banks and she expects it to report a strong quarter.
- "Bank of America's quarter will be filled with one-time events that may make it impossible to discern what the company is actually earning," Rochdale Securities analyst Richard Bove said in a recent earnings preview note.
- Atlantic Equities analyst Richard Staite said that Bank of America's consumer and retail banking results are expected to come in weak, but the contributions from Merrill Lynch could prove to be surprisingly strong
"That's quite important for sentiment because it will show that the Merrill acquisition wasn't a total disaster," he says.
Meanwhile,
EarningsPreviews.com expects revenues to be up 55% from last quarter, with the top line hitting $31.98 billion and earnings per share of 34 cents. -
Maria WoehrAlso see:
Citigroup second-quarter earnings previewGoldman Sachs earnings previewJ.P. Morgan Chase & Co. earnings preview
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