City National Earnings Preview

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Investors are on the edge of their seats, hoping that City National (NYS: CYN) will top analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday, Oct. 20. City National is a bank holding and financial holding company that provides a range of banking, investing, and trust services to its clients through its wholly-owned banking subsidiary, City National Bank.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on City National with 13 of 19 analysts rating it hold. Analysts don't like City National as much as competitor SVB Financial Group overall. Out of 17 analysts, seven rate SVB Financial Group a buy compared to five of 19 for City National. Analysts still rate the stock a hold, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $271.4 million in revenue this quarter. That would represent a rise of 6.6% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.83 per share. Estimates range from $0.77 to $0.91.

What our community says:
The majority of CAPS All-Stars see City National as a good bet, with 62.9% granting it an "outperform" rating. The majority of the Fools are in agreement with the All-Stars, as 64.9% give it an "outperform" rating. Fools are gung-ho about City National, though the message boards have been quiet lately with only 46 posts in the past 30 days. City National's bearish CAPS rating of two out of five stars falls somewhat short of the Fool community sentiment.

Management:
City National's profit has risen year over year by an average of more than twofold over the past five quarters. A year-over-year revenue decrease last quarter snapped a streak of three consecutive quarters of revenue increases.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Net Margin

15.7%

13.5%

13.2%

12.2%

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At the time this article was published

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