Royal Bank of Canada (NYSE: RY) has announced that it will release its Q4 2021 earnings results on Wednesday before markets open.
What to look for
For the last 12 months, the company has grown its revenue by 12.7%, with earnings growing 36.4%. The strong recovery is a result of economic rebound from the pandemic that caused banks to struggle last year. Banks are recovering from the downturn they took a year ago.
Earnings: Stockearning’s Estimated EPS for the current quarter under review is expected to be better than the CA$3 reported in the past quarter. The company topped analysts' estimates in the third quarter by CA$0.28. Historical EPS Performance shows that in the last 12 quarters, the company has topped estimates eight times (66%) and missed estimates four times (33%).
Revenue: The company reported revenue of CA$12.76 billion for the past quarter, topping estimates of CA$11.37 billion. Net income was up 55% YoY to $2.113 billion attributable to lower PCL.
Stock movement: Since the last earnings release, Royal Bank of America's stock has lost 0.4%. Royal Bank of America shares has been UP 17 times out of the past 29 quarters after the earnings release. So, the historical price reaction suggests a 58% probability of the share price going UP once Royal Bank of Canada releases Q4 2021 earnings. According to the Stockearning algorithm, the predicted first-day move is 1%, while the predicted move on the seventh day is 4%.
What analysts are saying
Credit Suisse analyst Mike Rizavanovic raised his price target for the stock from CA$135 to CA$140 per share and maintained a "Buy" rating in the shares after the release of third-quarter results. In a research note, the analysts told investors that while credit losses provision were the main driver for earnings beat in the last quarter, results in cored operating segments were robust and, in most instances, surpassed expectation. Mike raised the estimates citing a favorable outlook.
CIBC research analysts raised Royal Bank of Canada's target price to CA$149 from CA$145 in a research note to investors and clients. The CIBC target price represents 12.85% from the previous close.
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