“PNC Financial Services Group Inc. (PNC), the second-largest U.S. regional bank, said fourth-quarter profit rose 46 percent, beating analysts’ estimates, as revenue from fees increased.

Net income climbed to $719 million, or $1.24 a share, from $493 million, or 85 cents, a year earlier, the Pittsburgh-based bank said today in a statement. Excluding the cost of increased mortgage putback reserves and other one-time items, earnings per share were $1.71, compared with the $1.48 average estimate of 22 analysts surveyed by Bloomberg. Full-year profit declined 2.3 percent to $3 billion, or $5.30 a share.

Lenders including PNC and U.S. Bancorp, the nation’s largest regional bank, are boosting provisions for mortgage repurchases as government-sponsored enterprises Fannie Mae andFreddie Mac expand scrutiny of loans. U.S. regulators struck a deal with 10 mortgage servicers last week in which lenders must provide $5.2 billion in mortgage assistance and $3.3 billion in direct payments to wronged borrowers.

“Core earnings are moving in a direction to support higher valuations as growth continues into 2013, especially as this foreclosure settlement should begin to streamline future foreclosure activities and enable resources to be reduced in the servicing department,” Marty Mosby, an analyst at Guggenheim Securities LLC, said in a Jan. 9 note….”

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“Citigroup is reporting earnings that are below Wall Street’s expectations as the bank’s legal expenses climb.

Citi earned $1.2 billion after paying preferred dividends, or 38 cents per share, in the three months ended Dec. 31. That compares with $933 million, or 31 cents per share, in the same period a year earlier.

Excluding one-time costs related to restructuring and accounting for outstanding debt, the bank earned 69 cents per share. That’s well below the 97 cents per share analysts polled by FactSet were expecting.

Revenue rose to $18.7 billion, up 8 percent from the same period a year earlier and slightly below forecasts.

The bank had $1.3 billion in legal and related expenses in the quarter.

Citi’s stock fell $1.46 to $41.02 in pre-market trading Thursday.”

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“Fifth Third Bancorp. (FITB), Ohio’s largest lender, said fourth-quarter profit rose 27 percent as the firm booked a gain on a stake in Vantiv Inc. (VNTV)

Net income jumped to $399 million, or 43 cents a share, from $314 million, or 33 cents, a year earlier, the Cincinnati- based company said today in a statement. That compares with the 41-cent average estimate of 29 analysts surveyed by Bloomberg…”

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“OAO Gazprom, the biggest natural-gas producer, said profit doubled in the third quarter, beating analyst estimates, as a foreign exchange gain helped compensate for soaring costs.

Net income climbed to 305 billion rubles ($10.1 billion) from 152 billion rubles a year earlier, Moscow-based Gazprom said today on its website. That compared with an average estimate of 291 billion rubles from 10 analysts surveyed by Bloomberg. Revenue rose 18 percent to 1.12 trillion rubles.

Gazprom, Russia’s monopoly gas exporter, battled weakening European markets last year that forced suppliers to compete to maintain sales. The company offered discounts to some customers and raised the weight of spot market prices in setting rates, which are mainly linked to oil-price indexes. The gas producer raised investments even as demand weakened, saying it needs to ensure production and transport capacity for the future.

“There isn’t much to be positive about, despite the positive market reaction,” Ildar Davletshin, a gas analyst at Renaissance Capital in Moscow, said by phone today. “Costs increased for personnel, transit, oil and gas purchases.”

Gazprom shares rose as much as 1 percent in Moscow and traded up 0.8 percent at 147.50 rubles at 1:30 p.m.

‘Expected Worse’…”

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“SAN FRANCISCO (MarketWatch) — Bank of America Corp. on Thursday extends the run of big banks reporting earnings this week. Its biggest challenge will be how it stages a turnaround as it seeks to recover from wounds inflicted by its mortgage business.

Hopes are high for the sector as B. of A. BAC +1.99%  follows stellar earnings from Goldman Sachs Group Inc. GS +4.06%  and J.P. Morgan Chase & Co. JPM +1.01% . J.P. Morgan’s results topped Wall Street earnings estimates even as it continues to deal with its “London Whale” controversy. Read more on financial stocks on Wednesday.

Of 21 analysts surveyed by FactSet, Bank of America is expected to report earnings of 2 cents a share on revenue of $21.19 billion. With that in mind, here are five things to consider before Bank of America reports earnings Thursday morning….”

5 things to know 

“SAN FRANCISCO (Reuters) – EBay Inc reported holiday quarter results that beat Wall Street expectations as the e-commerce company benefited from a boom in mobile shoppers, but it gave a 2013 forecast in line with analyst estimates, restraining share price gains.

The stock rose 1 percent to $53.43 in after-hours trading following the announcement.

Expectations were high ahead of the results because sales data from outside sources suggested strong sales growth from eBay’s online marketplace and a solid increase in transactions processed by the company’s PayPal payments business.

EBay’s online marketplace, one of the largest in the world, has lagged behind the growth of e-commerce and Amazon.com Inc for several years. But under Chief Executive John Donahoe, eBay has invested to improve the buying experience by upgrading search capabilities and prodding sellers to provide more services such as free shipping and easier returns.

The explosive growth of mobile shopping and popular mobile shopping applications have also attracted millions of new consumers to eBay’s marketplace and PayPal in the past year.

“These are great numbers,” said Bill Smead of Smead Capital Management, which owns eBay shares. “The marketplace business used to be a noose around their neck, but now it’s a key destination for people wanting to buy new goods as well as existing goods.”

Amazon shares edged up less than 1 percent to $269.50 in after-hours trading, close to a record. The world’s largest Internet retailer is due to report fourth-quarter results on January 29.

On Wednesday, eBay said fourth-quarter revenue jumped 18 percent to $3.99 billion. Profit came in at $927 million, or 70 cents a share, in the period. That compares with profit of $789 million, or 60 cents a share, in the same quarter last year.

EBay was expected to earn 69 cents a share on revenue of $3.98 billion, according to Thomson Reuters I/B/E/S….”

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“This earnings season, the U.S. technology industry is in an unusual position – dragging corporate America down, rather than lifting it up.

Wall Street expects the tech sector’s fourth-quarter earnings to be down 1.1 percent from a year ago, the first drop since the third quarter of 2009, even though overallS&P 500 profits are still forecast to show growth, according to Thomson Reuters data.

Chip companies are expected to be among the worst performers because of softer-than-expected personal computer sales. Weak overseas demand and worries about the U.S. fiscal crisis have also likely caused corporations to put off IT spending.

“The lack of economic growth we’ve seen in Europe, the deceleration of emerging markets – that has put a significant amount of pressure, particularly on technology,” said Omar Aguilar, chief investment officer for equities at Charles Schwab Corp, in San Francisco.

Tech stocks have struggled recently and further weakness could dent the bullish 2013 forecasts many strategists have for the U.S. stock market. But some investors and analysts say weak fourth-quarter numbers have already been baked into many tech stock prices and valuations are attractive.

Analysts at Bank of America Merrill Lynch wrote in a note this week that tech stocks are undervalued by about 32 percent, more than any other sector, based on current forward price-to-earnings ratios. Every tech industry except IT services is trading well below historical levels, the note said…..”

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“DUBLIN, Ohio (AP) — Wendy’s fiscal fourth-quarter earnings topped Wall Street’s view, even as a key indicator of sales at North American restaurants dipped slightly. The hamburger chain also maintained its fiscal 2013 adjusted earnings forecast above analysts’ estimates, and its stock rose more than 4 percent in premarket trading Wednesday.

Wendy’s net income jumped to $22.4 million, or 6 cents per share, for the three months ended Dec. 30. That’s up sharply from $4 million, or 1 cent per share, a year earlier.

The current quarter’s results included a tax benefit, lower interest expense and a sharp rise in investment income.

Removing impairment charges, facility relocation costs and other items, adjusted earnings were 8 cents per share.

Revenue increased 2 percent to $629.9 million from $615 million.

Analysts surveyed by FactSet expected adjusted earnings of 4 cents per share on revenue of $637 million….”

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“Chipotle Mexican Grill Inc. (CMG) fell as much as 11 percent in early trading after reporting preliminary fourth-quarter profit that trailed analysts’ estimates.

The shares dropped 9.5 percent to $269 at 8:09 a.m. in New York, after earlier falling to $263.26. Chipotle declined 12 percent last year, the fifth-worse performance in the Russell 3000 Restaurants Index.

Profit in the quarter ended Dec. 31 may be $1.92 to $1.97 a share, the Denver-based restaurant chain said yesterday in a statement. Analysts projected $2.09, the average of estimates compiled by Bloomberg.

Food costs rose faster than the company expected, signaling the need to raise prices, according to John Glass, an analyst at Morgan Stanley in Boston. The burrito seller is up against increasing competition from rivals including Yum! Brands Inc. (YUM)’s Taco Bell, which is selling a more premium line of food called Cantina Bell….”

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“JPMorgan (JPM) announced that earnings for the fourth-quarter were $1.39 cents per share, beating estimates of $1.19 per share. Revenue increased by 10.2% year over year to $23.65 billion, beating estimates of $24.21 billion.

Shares are higher in early trading….”

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“(Reuters) – Goldman Sachs Group Inc said its fourth-quarter earnings nearly tripled, driven by big gains in stock and bond values, increased revenue from dealmaking and lower compensation expenses.

Goldman, the fifth-largest U.S. bank by assets, reported earnings of $2.8 billion, or $5.60 per share, up from $978 million, or $1.84 per share, in the same period a year ago.

Analysts mostly had been forecasting much lower figures. Following its early morning report on Wednesday, Goldman shares were up 1.8 percent at $138 in premarket trading.

A significant part of Goldman’s earnings boom came from improvements in market values in the stock and bond markets, as well as increased activity.

The New York-based investment bank said it took in “significantly higher” revenues from credit products and mortgages in its bond-trading business. Its investing and lending division, which mostly earns money from higher values on Goldman’s own stock and bond investments, reported nearly $2 billion worth of revenue….”

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“Bank of New York Mellon Corp., the world’s largest custody bank, said fourth-quarter earnings rose 23 percent as higher client assets boosted revenue.

Net income climbed to $622 million, or 53 cents per share, from $505 million, or 42 cents, a year earlier, the New York- based bank said today in a statement. Earnings a year earlier were reduced by expenses tied to job reductions. Analysts had expected BNY Mellon to report a profit of 54 cents a share, the average of 17 estimates in a Bloomberg survey…”

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“With banks having been the best DJIA sector in 2012, the outlook versus the valuation has started to play a game of catch-up as we are getting deeper into earnings season this week. Because the banks rose so much, they are in some cases priced for perfection.

24/7 Wall St. has decided to offer up a preview and earnings cheat sheet for the banking and finance sector’s key earnings this week. DJIA components Bank of America Corp. (NYSE: BAC) and J.P. Morgan Chase & Co. (NYSE: JPM) are on deck, as are key financial giants like Goldman Sachs Group Inc. (NYSE: GS), Citigroup, Inc. (NYSE: C), Bank of New York Mellon Corp. (NYSE: BK), and others….”

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“Profits have reached a record 11 percent of gross domestic product, which would normally make you bullish about stocks.

But not this time around, according to Jeremy Grantham, chief investment strategist of money manager GMO, The New York Times reports.

Much of the problem stems from the fact that companies are boosting their profits through borrowing money, he says. Corporations issued a record of more than $1 trillion of debt last year….”

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“SAP AG (SAP), the biggest maker of business-management software, reported earnings trailing analysts’ estimates as the company increased spending and growth in the Americas slowed. The shares fell.

Fourth-quarter operating profit excluding some items rose about 10 percent to 1.96 billion euros ($2.61 billion), the Walldorf, Germany-based company said today in a statement. Analysts projected 2 billion euros, the average of estimates compiled by Bloomberg. Sales of new software licenses, an indicator of future revenue, climbed 9 percent to 1.94 billion euros, compared with analysts’ 1.95 billion-euro projection….”

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“Total earnings for these 22 companies are up +1.4% from the same period last year, with total revenues up +3.5%. This is better performance than what this same cohort of 22 companies did in the third quarter when total earnings were down -2.4% from the year-earlier period….”

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“According to Bank of America Merrill Lynch, analysts have slashed 4Q EPS estimates by 12 percent since April due to fears about the macroeconomic environment.

But some companies may now have an easier time beating those lowered expectations.

Led by Savita Subramanian, BAML’s equity strategy team has screened for stocks they consider are most likely to beat analysts’ estimates for 4Q.

All of their choices are buy-rated stocks that beat either sales or EPS expectations the previous quarter.

All but four stocks from the team’s list come from either the Consumer Discretionary, Energy, or Information Technology sectors.

We’ve listed each of the 17 stocks along with their tickers, sectors, and consensus EPS and revenue estimates for 4Q…..”

Full list

“(Reuters) – Best Buy Co Inc on Friday slashed its expectations for 2013 free cash flow after it had to pay for inventory earlier than expected during a critical time for the world’s largest electronics chain.

The company, which is in the midst of a restructuring and faces a looming buyout proposal by its founder, also posted flat sales at its U.S. division for the holiday season.

Shares of Best Buy fell 2.4 percent to $11.92 in premarket trading.

Revenue slipped 0.4 percent to $12.8 billion in the nine weeks ended January 5. Sales at stores open at least 14 months were flat in the United States and fell 6.4 percent internationally on declines in Canada and China.

The company now expects free cash flow of about $500 million for the year ending on February 2, down from a November forecast that called for a range of $850 million to $1.05 billion.

While comparable-store sales, gross margin, earnings and inventory levels were in line with the company’s expectations, Best Buy now expects fiscal 2013 accounts payable as a percentage of inventories to be lower than those of the previous year. It previously said they would be consistent with those of the prior year.

Best Buy said it had received inventory earlier than expected and therefore had to make payments earlier. It also saw a shift in sales mix to higher-velocity merchandise categories that carry shorter payment terms….”

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“Wells Fargo & Co. (WFC), the largest U.S. home lender, reported a 24 percent rise in fourth-quarter profit as the bank made more money from mortgage banking and squeezed more income out of revenue.

Net income advanced to a record $5.09 billion, or 91 cents a share, from $4.11 billion, or 73 cents, a year earlier, the San Francisco-based bank said today in a statement. That beat the 89-cent average estimate of 27 analysts surveyed by Bloomberg, some of whom were excluding one-time costs tied to a regulatory settlement…..”

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“Jan. 11 (Bloomberg) — American Express Co. will eliminate 5,400 jobs this year, mostly in travel services, as consumers and businesses rely more on digital technology for bookings.

The lender posted a 47 percent drop in fourth-quarter profit and recorded after-tax charges totaling $594 million, including costs tied to severance and changes in how the firm estimates future redemptions of credit-card rewards, New York- based AmEx said yesterday in a statement….”

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