Friday's Earnings Releases
- BofA Notches Second-Quarter Profit. - Bank of America (BAC) reported second-quarter earnings of $3.2 billion, or 33 cents a share after deducting preferred dividends, down from the year-ago quarter but ahead of the Thomson Reuters average estimate of 28 cents a share. Howver, revenue of $32.77 billion was slightly below Wall Street's forecast of $33.1 billion.
- Citi Unveils Surprise Profit. - Citigroup (C) on Friday reported second-quarter profit of $4.27 billion, or 49 cents a share. Results included an $11.1 billion pre-tax gain, or $6.7 billion after-tax, associated with the joint venture it completed in June to combine its Smith Barney wealth management unit with Morgan Stanley's (MS) brokerage operations. Analysts, according to Thomson Reuters, expected the bank to post a loss of 37 cents a share in the quarter.
- GE Earnings Fall 47% Following 80% Drop in Capital Finance Segment. - General Electric (GE) said it earned $2.9 billion from continuing operations, or 26 cents a share, in the second quarter. Revenue fell 16.6% from the year-ago quarter to $39.08 billion. Analysts polled by Thomas Reuters had estimated earnings of 23 cents a share, although that number may not be comparable as GE's earnings were somewhat weaker when taking discontinued operations into account.
- Mattel Turns in Better-Than-Expected Profit. - Mattel (MAT) posted a second-quarter profit of $21.5 million, or 6 cents a share, even as sales dropped 19% to $898.2 million. On average, analysts expected the toymaker to post break-even earnings on a per-share basis on revenue of $969.7 million.
- BB&T Comes Up Short. - BB&T Corp. (BBT) reported second-quarter net income of $121 million, or 20 cents a share, which was slightly below the Thomson Reuters consensus estimate of 21 cents. Earnings were affected by a $47 million writedown associated with the company's repayment of $3.1 billion to the Treasury, along with $14 million in accrued dividends on June 17, when the company exited the Troubled Asset Relief Program, or TARP.
Friday's Early Headlines
- CIT Holding Talks for Financing. - Embattled lender CIT Group (CIT), teetering on the brink of bankruptcy, said it is in discussions with potential lenders to secure financing. It was reported Thursday that regulators weren't going to bail out CIT. The lender needs about $5.6 billion to avoid a bankruptcy filing, according to a report Thursday by bond research firm CreditSights.
- GM May Pick Opel Buyer Next Week. - General Motors is likely to select a buyer for Opel "early next week," an executive says, according to Bloomberg. Magna International (MGA) and RHJ International are "probably the frontrunners" for GM's European unit, said Nick Reilly, currently GM's Asia-Pacific head, in a Bloomberg TV interview. Reilly will take over GM's operations outside of North America next month.
- BofA's Columbia Has Suitors. - BlackRock (BLK) is likely to buy the money-market assets of Bank of America's Columbia Management unit, while Ameriprise Financial (AMP) is poised to buy Columbia's long-term equity and fixed-income business, according to a report from newspaper Pensions & Investments.
Friday's Economic News
- Housing Starts and Building Permits - The Census Bureau said housing starts rose to 582,000 in June from 562,000 in May, an increase of 3.6% and well ahead of economists' forecasts of 523,000. Building permits rose 8.7% to 563,000 in June after a 4% rise in May. Economists had expected building permits to fall to 530,000.