Do Citigroup earnings forecast another good year for big banking stocks?

James Dennin, Kapitall: Citigroup profits beat estimates while JP Morgan's disappointed. What does that mean for big banking stocks?

The big banking stocks began reporting earnings last Friday, starting with JP Morgan (JPM), and the news wasn't good at first. 

The world's largest financial institution by net assets declined in profitability this quarter, causing many to worry whether that spelled out bad news for other big names in the sector who report earnings this week. 

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However, it seems like those concerns might have been overly pessimistic. Today  Citigroup (C), the second big bank to report its first quarter earnings, reported profit growth that exceeded analyst expectations. 

That's caused most of the financial stocks on the Dow Jones to get a large bump in price this morning. Bank of America (BAC), Goldman Sachs (GS), and American Express (AXP) are all up at least 1%. Citigroup is up almost 5%, as of 12:25 PM New York Time.

It seems then that many who warned of "regulatory woes" over-estimated the effect of Dodd-Frank on the markets. It's true that Citigroup relied in part on layoffs to turn in an expectation-beating earnings report. But the strong results also came at a time when banks were tasked with re-vamping their trading procedures and dealing with imposed fines. 

Many other big banks will report earnings this week. Good news would augment confidence in the state of the economy; however, bad news could likely erase today's gains. 

Click on the interactive chart to view data over time. 

 Will these big banking stocks overcome new regulations or will they continue to provide unpredictable results? Use the list below to begin your analysis.

1. Bank of America Corporation ( BAC): Provides banking and financial services to individuals, small- and middle-market businesses, corporations, and governments primarily in the United States and internationally. Market cap at $175.76B, most recent closing price at $16.53.

 

 

2. American Express Company ( AXP): Provides charge and credit payment card products, and travel-related services worldwide. Market cap at $95.94B, most recent closing price at $89.92.

 

 

3. JPMorgan Chase & Co. ( JPM ): Provides various financial services worldwide. Market cap at $218.31B, most recent closing price at $58.03.

 

 

4. Citigroup, Inc. ( C): Provides consumers, corporations, governments, and institutions with a range of financial products and services. Market cap at $148.31B, most recent closing price at $48.98.

 

5. The Goldman Sachs Group, Inc. ( GS): Provides investment banking, securities, and investment management services to corporations, financial institutions, governments, and high-net-worth individuals worldwide. Market cap at $77.79B, most recent closing price at $166.54.

 

(List compiled by James Dennin, a Kapitall Writer. Monthly returns sourced from Zacks Investment Research, all other data sourced from Finviz.)

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