Truist Financial (NYSE:) Corporation reported stronger-than-expected earnings for Q3 2024, surpassing analysts’ forecasts with an EPS of $0.91 against a forecast of $0.88. The company’s revenue also exceeded expectations, reaching $5.11 billion compared to the anticipated $5.04 billion. Following the earnings announcement, Truist’s stock climbed in pre-market trading, reflecting investor optimism.
Key Takeaways
- Truist Financial’s Q3 EPS of $0.91 exceeded the forecast of $0.88.
- Revenue reached $5.11 billion, surpassing the expected $5.04 billion.
- Stock price increased by 2.96% in pre-market trading.
- Strong performance in investment banking with a 79% YoY revenue increase.
- Continued focus on digital growth and infrastructure investment.
Company Performance
Truist Financial demonstrated robust performance in Q3 2024, driven by significant gains in its investment banking division, which saw a 79% year-over-year increase in revenue. The company also experienced growth in digital transactions and mobile app usage, indicating successful digital transformation efforts. Despite muted overall deposit growth, Truist maintained a stable CET1 capital ratio of 11.6%, reflecting strong financial health.
Financial Highlights
- Revenue: $5.11 billion, up from the forecasted $5.04 billion.
- Earnings per share: $0.91, compared to the forecast of $0.88.
- Adjusted EPS: $0.97.
- GAAP net income: $1.3 billion ($0.99/share).
- Returned $1.2 billion to shareholders through dividends and stock repurchases.
Earnings vs. Forecast
Truist Financial’s EPS of $0.91 outperformed the forecast of $0.88, marking a positive surprise of approximately 3.4%. Revenue also exceeded expectations by $70 million, highlighting the company’s strong operational performance. This beat contrasts with previous quarters where results were more aligned with forecasts, suggesting improved strategic execution.
Market Reaction
In response to the earnings beat, Truist’s stock price rose by 2.96% in pre-market trading, reaching $46.31. This movement reflects positive investor sentiment, especially considering the stock’s recent close at $44.98. The increase positions the stock closer to its 52-week high of $49.06, indicating renewed market confidence.
Outlook & Guidance
Truist Financial remains optimistic about its future, targeting positive operating leverage in 2025. The company anticipates a 1.5% decrease in net interest income for Q4 and expects two 25 basis point Federal Funds rate cuts. The medium-term ROTCE target is set in the mid-teens, with continued emphasis on capital deployment and shareholder returns.
Executive Commentary
CEO Bill Rogers (NYSE:) emphasized the company’s commitment to growth and community impact, stating, “We’re dedicated to inspiring and building better lives and communities.” He also highlighted Truist’s strategic advantage, noting, “Our relative capital advantage is a differentiating factor.”
Q&A
During the earnings call, analysts inquired about Truist’s deposit beta expectations…
Read More: Truist Financial beats Q3 2024 forecasts By Investing.com
