Bank of America will release their second quarter earnings report on Monday, which could be bonus for financial ETFs with the heaviest exposure to the bank, such as iShares U.S. Financial Services ETF
Financials Equities (NYSEArca: IYG), Financial Select Sector SPDR Fund Financials Equities (NYSEArca: XLF) and Invesco KBW Bank ETF Financials Equities (NASDAQ: KBWB).
Consensus estimates are pegged at about 57 cents per share, which represents a decrease of a nickel compared to last quarter. In terms of expected revenue, analysts are expecting a range of $21.74 billion and $23.05 billion versus $23.1 billion in the first quarter–all based on an analyst poll by Yahoo! Finance.
Related: Citigroup Earnings Shows Decline in Fixed-Income Revenue
If BofA exceeds these estimates, it will be a welcome rebound for all three ETFs after closing in the red during Friday’s trading session–IYG was down 0.73%, XLF was down 0.48% and KBWB was down 0.57%. Much of that blame can be directed towards Wells Fargo who posted losses in their second quarter earnings report, sending their shares tumbling 1.20%.
In addition, Citigroup’s stock fell 2.20% after posting a mixed earnings report. IYG, XLF and KBWB all have holdings in both Citigroup and Wells Fargo.
That being said, their fortunes can change on Monday if BofA’s projections hold true. Following the release of BofA’s first quarter earnings, CEO Brian Moynihan was brimming with confidence when speaking about the sustainability of the bank’s future growth.
“Our responsible growth model continues to deliver consistent results,” said Moynihan. “We continue to invest in new capabilities in our mobile banking app, the expansion and renovation of our financial centers and the hiring of additional client relationship professionals. We believe these investments, and our focus on operational excellence, will drive sustainable growth over time.”
IYG is currently the only ETF in the green year-to-date based on Yahoo! Finance performance figures. IYG is up 0.04% YTD while XLF and KBWB are both down 3.97% and 1.85%, respectively.
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