PNC Financial PNC is scheduled to report third-quarter 2020 earnings, before the opening bell, on Oct 14. The company’s revenues and earnings are likely to have witnessed a year-over-year decline.
In the last reported quarter, the company reported loss on higher provisions due to the coronavirus pandemic’s crippling impact on the economy. Lower revenues on decline in fee income and decrease in loans were undermining factors.
The company’s activities in the to-be-reported quarter were adequate to win analysts’ confidence. As a result, its Zacks Consensus Estimate for earnings of $1.99 has moved up 11.8% in the past seven days. Nevertheless, the figure indicates a 32.3% decline from the year-ago reported figure. The consensus estimate for sales is pegged at $3.96 billion, suggesting a decline of 11.8% year over year.
The PNC Financial Services Group, Inc Price and EPS Surprise
The PNC Financial Services Group, Inc price-eps-surprise | The PNC Financial Services Group, Inc Quote
Now let’s discuss the factors that are likely to have impacted the company’s third-quarter results:
Lower Net Interest Income (NII): The Fed continued to keep interest rates at near zero in order to shield the U.S. economy from the coronavirus outbreak-related mayhem. This is likely to have substantially hurt net interest margin and NII.
Also, per the Fed’s latest data, the loan balance is likely to have been affected by a fall in commercial & industrial and consumer loans on a sequential basis.
The Zacks Consensus Estimate for average interest earning assets of $397.3 billion for the quarter indicates 1.2% sequential fall. The consensus estimate for net interest income is $2.47 billion, suggesting 2.1% fall sequentially.
Notably, management expects average loans to decline in the low-single-digit range on a sequential basis in the third quarter and NII to be down 1%.
Muted Non-Interest Revenues: The quarter