Fifth Third, Steel Dynamics Earnings Test Bank Trends And Steel Demand

Fifth Third Bancorp headlines Monday’s reports as investors weigh whether merger synergies and loan trends can offset pressure on bank earnings. Cleveland-Cliffs and Dynex Capital report before the open; Steel Dynamics, WR Berkley, Crown Holdings, AGNC Investment, Wintrust Financial, Zions Bancorp and Western Alliance Bancorp report after the close.

Key Reports Before The Bell

Fifth Third Bancorp (NASDAQ:FITB) — Q3 — 6:30 a.m. ET

• EPS: $0.87 est. vs. $0.93 a year ago (-6%)
• Revenue: $3.34 billion est. vs. $2.31 billion a year ago (+45%)
• Stock: -4.8% past month, +7.6% YTD, 15.3% below its 52-week high
• Analyst view: Buy consensus, $62 target (14 analysts)

The bank is expected to show strong revenue growth even as EPS declines, putting the focus on net interest income, deposit trends and the progress of its Comerica integration. Fifth Third has beaten estimates in all of its past eight quarters. In Q2, it beat on both EPS and revenue. On its July call, management highlighted tangible book value growth and said the Comerica merger was progressing, with customer retention and early deposit growth in the Southwest. TD Cowen reinstated coverage with a Buy rating and a $60 target on Oct. 8.

Cleveland-Cliffs (NYSE:CLF) — Q3 — 6:00 a.m. ET

• EPS: $0.24 est. vs. -$0.45 a year ago (swing to profit)
• Revenue: $5.69 billion est. vs. $4.73 billion a year ago (+20%)
• Stock: -3.0% past month, -8.7% YTD, 27.7% below its 52-week high
• Analyst view: Hold consensus, $12 target (7 analysts)

The steelmaker is expected to swing to a profit as revenue grows, but the stock’s decline this year leaves investors looking for evidence that automotive demand, pricing and cost actions can sustain the recovery. In Q2, it missed on EPS but beat revenue. On its July call, management pointed to positive free cash flow, stronger automotive demand and footprint optimization while expecting significant Q3 growth. Wells Fargo upgraded the stock to Overweight from Equal-Weight with a $14 target on Oct. 6.

Dynex Capital (NYSE:DX) — Q3 — 8:00 a.m. ET

• EPS: $0.53 est. vs. $0.25 a year ago (+112%)
• Revenue: $113.0 million est. vs. $30.6 million a year ago (+269%)
• Stock: -9.0% past month, -21.0% YTD, 26.7% below its 52-week high
• Analyst view: Buy consensus, $14 target (3 analysts)

The mortgage real estate investment trust is expected to more than double EPS, but its sharp stock decline makes portfolio performance, funding costs and book-value resilience the key read-through. Dynex Capital has beaten estimates in just one of its past eight quarters. In Q2, it missed on EPS but beat revenue. On its July call, management emphasized agency mortgage-backed securities, which helped drive portfolio growth while maintaining an 8.1% leverage ratio. BTIG maintained its Buy rating while cutting its target to $12 on Oct. 7.

Key Reports After The Bell

Steel Dynamics (NASDAQ:STLD) — Q3 — 4:30 p.m. ET

• EPS: $5.41 est. vs. $2.74 a year ago (+97%)
• Revenue: $6.46 billion est. vs. $4.83 billion a year ago (+34%)
• Stock: +2.2% past month, +42.0% YTD, 16.7% below its 52-week high
• Analyst view: Buy consensus, $260 target (9 analysts)

Steel Dynamics is expected to nearly double EPS after a powerful run in the shares, making shipment volumes, pricing and the durability of demand more important than the headline beat alone. In Q2, it beat on both EPS and revenue. On its July call, management cited record steel shipments and said higher pricing and volumes drove strong results. Wells Fargo maintained its Overweight rating while raising its target to $257 from $255 in September.

WR Berkley (NYSE:WRB) — Q3 — 4:11 p.m. ET

• EPS: $1.16 est. vs. $1.10 a year ago (+5%)
• Revenue: $3.34 billion est. vs. $3.77 billion a year ago (-11%)
• Stock: +7.9% past month, +7.6% YTD, 4.5% below its 52-week high
• Analyst view: Hold consensus, $71 target (12 analysts)

The insurer is expected to post modest EPS growth despite lower revenue, so underwriting performance and pricing discipline will determine whether the recent share-price strength has room to continue. WR Berkley has beaten estimates in seven of its past eight quarters. In Q2, it beat on both EPS and revenue. On its July call, management highlighted resilience amid competitive pressures and market adjustments. Wells Fargo maintained its Underweight rating while cutting its target to $65 from $68 on Oct. 12.

Crown Holdings (NYSE:CCK) — Q3 — 4:05 p.m. ET

• EPS: $2.26 est. vs. $2.24 a year ago (+1%)
• Revenue: $3.44 billion est. vs. $3.20 billion a year ago (+7%)
• Stock: +4.5% past month, +10.9% YTD, 7.1% below its 52-week high
• Analyst view: Buy consensus, $132 target (11 analysts)

Crown Holdings enters the report with little expected EPS growth, leaving beverage-can shipments, foreign exchange and the sustainability of its full-year outlook as the main catalysts. The company has beaten estimates in all of its past eight quarters. In Q2, it beat on both EPS and revenue. On its July call, management cited stronger global beverage-can shipments and raised its full-year adjusted EPS guidance to $8.30-$8.50. UBS maintained its Neutral rating while cutting its target to $116 from $123 on Oct. 5.

AGNC Investment (NASDAQ:AGNC) — Q3 — 4:01 p.m. ET

• EPS: $0.39 est. vs. $0.35 a year ago (+11%)
• Revenue: $443.3 million est. vs. $148.0 million a year ago (+200%)
• Stock: -11.7% past month, -18.7% YTD, 28.2% below its 52-week high
• Analyst view: Hold consensus, $11 target (6 analysts)

AGNC is expected to deliver modest EPS growth while the stock sits under pressure, making economic return, tangible book value and agency mortgage-backed security performance more relevant than revenue growth. AGNC Investment has beaten estimates in just three of its past eight quarters. In Q2, it beat on EPS but missed revenue. On its July call, management pointed to a 6.7% economic return and the resilience of agency mortgage-backed securities. Piper Sandler maintained its Overweight rating while cutting its target to $10 from $12 on Oct. 9.

Wintrust Financial (NASDAQ:WTFC) — Q3 — 4:15 p.m. ET

• EPS: $3.30 est. vs. $3.06 a year ago (+8%)
• Revenue: $754.8 million est. vs. $697.8 million a year ago (+8%)
• Stock: -2.3% past month, +3.0% YTD, 13.8% below its 52-week high
• Analyst view: Buy consensus, $180 target (10 analysts)

Wintrust is expected to extend its earnings growth, with loan and deposit expansion setting the bar for another strong regional-bank print. The company has beaten estimates in seven of its past eight quarters. In Q2, it beat on both EPS and revenue. On its July call, management reported another record quarter alongside strong organic loan and deposit growth. Deutsche Bank initiated coverage at Buy with a $175 target on Oct. 13.

Zions Bancorp NA (NASDAQ:ZION) — Q3 — 4:10 p.m. ET

• EPS: $1.65 est. vs. $1.48 a year ago (+11%)
• Revenue: $892.1 million est. vs. $861.0 million a year ago (+4%)
• Stock: -2.9% past month, +8.3% YTD, 13.6% below its 52-week high
• Analyst view: Hold consensus, $73 target (15 analysts)

Zions is expected to grow EPS and revenue, but the market will be looking for recurring operating momentum after unusual items influenced the prior quarter. The company has beaten estimates in seven of its past eight quarters. In Q2, it beat on both EPS and revenue. On its July call, management discussed loan growth, capital-markets expansion and the expected acquisition of Basis Investment Group’s multifamily lending business. Baird upgraded the stock to Outperform from Neutral with a $75 target on Oct. 15.

Western Alliance Bancorp (NYSE:WAL) — Q3 — 4:20 p.m. ET

• EPS: $2.43 est. vs. $2.28 a year ago (+7%)
• Revenue: $987.5 million est. vs. $938.2 million a year ago (+5%)
• Stock: -5.1% past month, -11.4% YTD, 23.3% below its 52-week high
• Analyst view: Buy consensus, $90 target (13 analysts)

Western Alliance is expected to post steady growth, but its weaker stock setup puts loan growth, deposit costs and net interest margin at the center of the reaction. In Q2, it missed on EPS but beat revenue. On its July call, management highlighted C&I-led loan growth, stable margins, improving credit trends and deposit optimization. RBC Capital maintained its Outperform rating while cutting its target to $93 from $95 on Oct. 9.

Also Reporting After The Bell

• BOK Financial (NASDAQ:BOKF) — $2.52 EPS on $570.7 million revenue
• F N B (NYSE:FNB) — $0.43 EPS on $476.1 million revenue
• RLI (NYSE:RLI) — $0.54 EPS on $467.0 million revenue
• Servisfirst Bancshares (NYSE:SFBS) — $0.83 EPS on $173.1 million revenue

Plus 6 companies valued between $100 million and $2 billion, including Karooooo, SmartFinancial and Washington Trust Bancorp.

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