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UPDATE 1-Nomura raises earnings views on Goldman, BofA, Citi
March 1, 2012 / 2:20 PM / 6 years ago

UPDATE 1-Nomura raises earnings views on Goldman, BofA, Citi

* Raises Goldman Sachs Q1 EPS view to $3.25 from $2.17

* Raises Bank of America Q1 EPS view to $0.11 from $0.04

* Raises Morgan Stanley Q1 EPS view to $0.38 from $0.32

* Raises Citigroup Q1 EPS view to $1.20 from $0.80

* Raises JPMorgan Q1 EPS view to $1.15 from $1

March 1 (Reuters) - U.S. banks, brokers and asset managers will generate higher capital market revenues in the first quarter, on improving economic data and increasing near-term comfort around Europe, Nomura said and raised earnings estimates on several companies.

Nomura raised its earnings estimates on Goldman Sachs (GS.N), Morgan Stanley (MS.N), Bank of America (BAC.N), Citigroup Inc (C.N) and others, and said Goldman will likely post a double-digit return on equity in the first quarter.

“FICC trading and asset management businesses are faring best year-to-date as investor risk appetite has increased and asset levels are higher,” Nomura analysts, including Glenn Schorr, wrote in a note.

Schorr is a four-star rated analyst for the accuracy of his earnings estimates on the companies under his coverage, according to Thomson Reuters StarMine data.

Starmine awards the top 10 percent of analysts five stars, the next 23 percent 4 stars and the lowest 10 percent one star.

Nomura analysts also expect equity trading activity and investment banking volumes to see some improvement.

Among the brokers and universal banks, Nomura favors Citigroup, JP Morgan Chase & Co (JPM.N) and Goldman Sachs.

Nomura also raised its price targets on banks like State Street Corp (STT.N), Northern Trust Corp (NTRS.O) and brokers and asset managers like Invesco (IVZ.N), T Rowe Price (TROW.O).

“Even after the solid rally so far this year, financials continue to trade at historically low multiples, with most of the brokers and universal banks at discounts to tangible book value,” the brokerage said.

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(Reporting by Rachel Chitra in Bangalore; Editing by Gopakumar Warrier)

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