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With a market cap of $28.4 billion, Cincinnati, Ohio-based Fifth Third Bancorp (FITB) is a diversified financial services company. It operates through its subsidiary, Fifth Third Bank, and provides a wide range of financial products and services across the United States. The company is expected to announce its fiscal Q4 earnings results before the market opens on Tuesday, Jan. 21.
Ahead of this event, analysts expect the bank to report a profit of $0.88 per share, down 11.1% from $0.99 per share in the year-ago quarter. However, the company has surpassed Wall Street's earnings estimates in the last four quarters. In Q3, FITB exceeded the consensus EPS estimate by 3.7%.
For fiscal 2024, analysts expect FITB to report an EPS of $3.34, down 5.9% from $3.55 in fiscal 2023. Nevertheless, EPS is expected to grow 8.4% year-over-year to $3.62 in fiscal 2025.
Shares of FITB have risen 22.6% over the past 52 weeks, lagging behind both the S&P 500 Index's ($SPX) 23.3% surge and the Financial Select Sector SPDR Fund’s (XLF) 28.5% return over the same period.
Despite beating earnings expectations with adjusted EPS of $0.85, Fifth Third Bancorp saw its shares fall 1.5% on Oct. 18. The company's Q3 total revenue of $2.1 billion missed the consensus estimate, marking a slight decline year-over-year. Net interest income (NII) also fell by 1.2% to $1.4 billion, below the estimate, while the net interest margin shrank to 2.9%. Additionally, non-interest income fell, primarily due to weaker mortgage banking and leasing revenues. Furthermore, a 4.7% rise in non-interest expenses, driven by higher compensation, technology, and communication costs, along with a significant 34.5% increase in provisions for credit losses, raised concerns among investors.
Analysts' consensus view on Fifth Third Bancorp’s stock is cautiously optimistic, with a "Moderate Buy" rating overall. Among 22 analysts covering the stock, 10 recommend "Strong Buy," one suggests "Moderate Buy," and 11 indicate “Hold.” The average analyst price target for FITB is $50.38, indicating a 19.2% potential upside from the current levels.
