It’s going to be an exciting week on Wall Street as the new earnings season begins to pick up speed. What should investors watch for in Bank of America Corp (NYSE:BAC), Intel Corporation (NASDAQ:INTC), and General Electric Company (NYSE:GE)?
Bank of America
Bank of America is set to announce its second quarter 2015 earnings results on Wednesday, July 15 before the market opens. Analysts expect the company to post earnings of $0.36 a share and $21.30 billion in revenue, up from $0.19 earnings per share but down from $21.96 billion in revenue the same quarter a year prior.
It is worth noting that Bank of America has posted revenue below analysts’ estimates for the past three consecutive quarters. With that said, the bank’s Consumer Banking unit is projected to improve this quarter due to core deposit growth. Investors see this as a good sign as Bank of America’s Consumer Banking unit generates approximately 36% of its revenue.
Bank of America has also been dealing with legacy disputes and new regulations ever since the 2008 financial crisis. As a result, Bank of America’s earnings results have been clouded by investors worrying about legal liabilities arising from the subprime mortgage crisis. However, the bank’s legal disputes have been settled and now investors can focus on the future.
Out of five analysts polled by TipRanks, three are bullish on Bank of America, one is bearish, and one is neutral. The average 12-month price target for Bank of America is $19.63, marking a 17.54% potential upside from where the stock is currently trading. On average, the all analyst consensus for Bank of America is Hold.
Intel will post second quarter 2015 earnings results on Wednesday, July 15 after market close. The company is expected to post earnings of $0.51 per share and $13.07 billion in revenue, falling from $0.55 earnings per share and $13.83 billion in revenue year-over-year.
The upcoming earnings report is expected to be the first in two years to post a year-over-year sales decline due to decreasing demand in the PC business. Intel is one of the biggest providers of PC’s and servers. Prior to its earnings, Intel called the PC business “challenging” and slashed its capital spending plan from $10 billion to approximately $8.7 billion.
Intel has plummeted over 19% year-to-date as a result of the falling PC market. The company’s rivals, like Advanced Micro Devices (AMD) and Micron Technology (MU) have also taken a major hit from PC decelerating sales, having fallen over 26% and over 49% year-to-date, respectively.
Despite Intel’s PC struggles, the company still offers a steady quarterly dividend of $0.24, yielding 3.1% annually.
Out of 29 analysts polled by TipRanks, 16 are bullish on Intel, 3 are bearish, and 10 are neutral. The average 12-month price target for Intel is $35.28, marking a potential upside of 20.95% from where the stock is currently trading. On average, the all-analyst consensus for Intel is Hold.
General Electric Company
General Electric is slated to announce second quarter 2015 earnings results on Friday, July 17 before the market opens. Wall Street expects the company to post earnings of $0.30 a share and $28.17 billion in revenue, down from $0.39 earnings per share and $36.23 billion in revenue from the same quarter last year.
General Electric has been undergoing a major restructuring since this past April in an effort to shift focus back to its industrial divisions. As part of the restructuring, GE is selling the bulk of its real estate portfolio to Blackstone and Wells Fargo for $26.5 billion. On the other hand, GE is keeping their “vertical” financing businesses that directly impact its core industrial business, including its Capital Aviation Services, Energy Financial Services, and Healthcare Equipment Finance.
General Electric is hoping its restructuring will help is industrial business transition from raking in about 58% of the company’s revenue to 90% by 2018.
Wall Street generally expects General Electric to post an expansion on its bottom line despite a shrinking top line.
Out of five analysts polled by TipRanks, three analysts are bullish on General Electric and two are neutral. The 12-month average price target for GE is $31, marking a potential upside of 18.01% from where the stock is currently trading. On average, the all-analyst consensus for General Electric is Moderate Buy.