Truist Financial (NYSE:TFC) received a Hold rating from Saul Martinez of HSBC, who priced the stock at $29.00, following the firm's Q3 2023 earnings report. The earnings per share (EPS) for the quarter was below Martinez's forecast but outperformed market consensus. According to InvestingPro data, the firm's P/E ratio stands at 6.83. The firm's revenue met his predictions, but there were marginally higher adjusted expenses and loan loss provisions. The company's revenue growth in the last twelve months (LTM) until Q3 2023 was -1.31%. Despite these challenges, net interest income (NII) was above his forecast.
Martinez noted that the growth rate of adjusted expenses has slowed from previous quarters, with a further slowdown predicted. He also took into account factors such as continued NII pressure, capital constraints, and execution risks on self-help efforts. Bank of America Securities echoed Martinez's Hold rating on TFC, setting a price target of $32.00. InvestingPro Tips for TFC highlight that the company has high earnings quality, with free cash flow exceeding net income and has raised its dividend for 8 consecutive years. It is worth noting that TFC pays a significant dividend to shareholders, with a dividend yield of 7.41%.
Truist Financial emerged as the sixth largest commercial bank in the U.S., following the merger of BB&T and SunTrust banks in December 2019. It is a prominent player in the Banks industry, as per InvestingPro Tips.
On the same day, American Express (NYSE:AXP) reported Q3 earnings that surpassed expectations due to a 13% rise in revenue and a 34% increase in earnings per share year-over-year. This robust performance was driven by resilient spending from wealthy customers and a 20% hike in credit card fees, which accounted for over 70% of new accounts. InvestingPro data shows that the company's P/E ratio is 14.62 and has a revenue growth of 10.52% LTM until Q2 2023.
Despite an increase in annual fees for the platinum card to $695 and for the business gold card to $375, consumer spending remains strong, particularly among affluent customers and the millennial user base that American Express is actively attracting. According to InvestingPro Tips, American Express yields high return on invested capital and stockholders receive high returns on book equity.
However, provisions for credit losses saw a significant 58% rise, amounting to roughly $1.2 billion for the recent quarter. Despite this increase and potential impacts on write-off and delinquency rates, card metrics remain strong with these rates still below pre-pandemic levels. The full-year outlook for American Express aligns with prior forecasts. For more insights, you can explore additional tips on InvestingPro.
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