TCF Financial Corporation
) is scheduled to report its second-quarter 2014 results on Jul 25.
TCF Financial's first-quarter 2014 earnings of 24 cents per share
beat the Zacks Consensus Estimate. The figure also reflected a 50%
year-over-year rise. Notably, results for the quarter included an
amortization charge. Results reflected top-line growth and lower
provision for credit losses. However, increase in non-interest
expenses was on the downside.
Will TCF Financial miss earnings estimates this season? Let's see
how things have shaped up for this announcement.
Factors to Influence Q2 Results
TCF Financial has been facing challenges in controlling its
non-interest expenses that have been escalating over the past few
years as well as in first-quarter 2014. Though the company is
focused on achieving optimized expenses through several initiatives
including asset growth in lending business, branch consolidation
and reduced foreclosed real estate and other credit costs, we are
not confident about the extent of reflection of these factors in
the second quarter.
TCF Financial's card revenues form a significant component of total
banking fee revenues. We observed that due to a decrease in the
average interchange rate per transaction owing to new debit card
interchange regulations, which took effect on Oct 2011, card
revenues have been consistently declining since 2011. We expect
continuation of such a trend to limit the company's revenue
However, the company's financials might get some support owing to
an asset sensitive balance sheet and continuous benefit from
balance sheet streamlining. Also, given the rise in home values in
major markets and the ongoing recovery of the economic scenario,
the company's credit quality is expected to exhibit improvement in
this quarter as well.
Activities of TCF Financial during the quarter were inadequate to
win analysts' confidence. As a result, the Zacks Consensus Estimate
for the quarter remained stable at 27 cents per share over the last
Our proven model does not conclusively show that TCF Financial is
likely to beat the Zacks Consensus Estimate in the upcoming
release. This is because a stock needs to have both a positive
and a Zacks Rank #1 (Strong Buy) or at least #2 (Buy) or #3 (Hold)
for this to happen. Unfortunately, this is not the case here as
: The Earnings ESP for TCF Financial is 0.00%. This is
because both the Most Accurate estimate and the Zacks Consensus
Estimate stand at 27 cents per share.
: TCF Financial's Zacks Rank #3 increases the predictive power of
ESP. However, we also need to have a positive ESP to be
confident of an earnings surprise call.
Stocks That Warrant a Look
Here are some stocks in the finance sector you may want to
consider, as our model shows that these have the right combination
of elements to post an earnings beat this quarter:
Affiliated Managers Group Inc.
) has an earnings ESP of +1.16% and carries a Zacks Rank #2. It is
scheduled to report its second-quarter results on Jul 29.
The Carlyle Group LP
) has an earnings ESP of +4.55% and holds a Zacks Rank #3. It is
expected to report its results for the quarter ended June 2014 on
Fortress Investment Group LLC
) has an earnings ESP of +17.65% and carries a Zacks Rank #3. It is
scheduled to report its second-quarter results on Jul 31.
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TCF FINL CORP (TCB): Free Stock Analysis Report
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