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M&T Bank (MTB) to Post Q2 Earnings: What's in the Offing?

M&T Bank Corporation MTB is scheduled to report second-quarter 2017 results on Jul 19, before the opening bell. The company’s revenues and earnings are expected to show improvement over the year-ago quarter.

M&T Bank has a mixed surprise history. It surpassed earnings estimates in two of the trailing four quarters, with an average positive surprise of 3.4%.

In the previous quarter, the company easily beat the Zacks Consensus Estimate by 21 cents. Earnings were supported by improved loan and deposit balances. Further, eased margin pressure aided the top line. However, higher expenses and provisions were the headwinds.

M&T Bank Corporation Price and EPS Surprise

Earnings Whispers

Our proven model shows that M&T Bank doesn’t have the right combination of two key ingredients – positive Earnings ESP and a Zacks Rank #3 (Hold) or better – to increase the odds of an earnings beat.

Zacks ESP: The Earnings ESP for M&T Bank is 0.00%. This is because the Most Accurate estimate of $2.28 matches the Zacks Consensus Estimate.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: M&T Bank’s Zacks Rank #3 increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of a positive earnings surprise.

Factors at Play

Net Interest Income Might Grow: Given a higher interest rate environment and rebound in average loan growth, net interest income is likely to show improvement in the second quarter.

Pressure on Net Interest Margin (NIM) Might Ease: Though the prolonged low-rate environment has taken a toll on the bank’s margins over the past several quarters, the recent hike in interest rates should alleviate some pressure. However, lower treasury yields may curb the positive effect to some extent.

Decline in Fee Income: Fee income might be affected by dismal global M&A activities in the quarter. Further, a higher interest rate environment might have affected its mortgage banking business.  

Expenses to Trend Higher: Expenses might trend upward in the upcoming release due to digitization and investments in technology. Further, management expects nominal growth in expenses this year.

Activities of M&T Bank during the quarter were adequate to win analysts’ confidence. As a result, the Zacks Consensus Estimate for the to-be-reported quarter increased slightly to $2.28, over the last seven days.

Stocks that Warrant a Look

Here are some stocks you may want to consider, as they have the right combination of elements to post an earnings beat in their upcoming reports.

Citizens Financial Group, Inc. CFG is slated to report second-quarter results on Jul 21. It has an Earnings ESP of +1.70% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Fifth Third Bancorp’s FITB Earnings ESP is +2.38% and it carries a Zacks Rank #3. The company is expected to release second-quarter results on Jul 21.

Huntington Bancshares Incorporated HBAN has an Earnings ESP of +4.35% and a Zacks Rank #3. It is scheduled to report second-quarter results on Jul 21.

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M&T Bank Corporation (MTB): Free Stock Analysis Report
Fifth Third Bancorp (FITB): Free Stock Analysis Report
Huntington Bancshares Incorporated (HBAN): Free Stock Analysis Report
Citizens Financial Group, Inc. (CFG): Free Stock Analysis Report
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