Major US banks JPMorgan, Goldman Sachs and Wells Fargo reported better-than-expected Q1 2021 results amid US economic recovery thanks to government stimulus packages and a massive COVID-19 vaccination.
US banks reported the first three months of 2021 today before trading opened, with stocks reacting as follows: JPMorgan Chase (JPM) down 0.7%, Goldman Sachs (GS) up 1.7% and Wells Fargo (WFC) shares rose little.
JPMorgan Chase report
JPMorgan's earnings for the first quarter of 2021 rose sharply to $4.50 per share, up from $3.07 in the previous quarter and $0.78 in the year-ago quarter, well above analysts' estimates of $3.09 earnings per share. The bank said, excluding the benefit from the release of provisions as well as other one-off items, JPMorgan's first-quarter profit was $3.31 per share. For the entire first quarter, the bank posted $14.3 billion in net profit, up $11.4 billion from a year earlier
JPMorgan's total quarterly earnings were up 14%.
JPMorgan Chase shares are up 21.26% since the start of 2021 and up nearly 57% in the past 12 months.
Goldman Sachs report
The first quarter of 2021 was a record revenue and earnings quarter for Goldman Sachs, significantly beating Wall Street estimates thanks to strong growth in equity underwriting and investment banking revenues.
Goldman Sachs reported earnings per share of $18.60, up 498% from a year ago and $8.38 above analysts' average estimate of $10.22.
The bank's total quarterly revenue rose 128% to $17.7 billion.
Goldman Sachs shares are up 24.26% since the start of 2021 and up almost 83% in the past 12 months.
Wells Fargo report
Wells Fargo reported a 10% increase in earnings per share to $1.05, up $0.35 from analysts' estimate of $0.70. The bank's earnings rose 2% YoY to $18.06bn and also beat Wall Street forecasts of $17.5bn.
Of the six largest US banks, Wells Fargo has the weakest investment banking divisions, with other banks showing strong growth in recent months thanks to a rise in IPOs and unprecedented support from the Fed. Last year Wells Fargo was the only bank among the six biggest US lenders to be forced to cut its dividend after the Federal Reserve's annual stress test.