Deutsche (DB) Reports Preliminary Q2 Profit, Stock Gains 8%

Buy or sell dice

Deutsche Bank AGDB has gained more than 8% on the NYSE following the release of its preliminary second-quarter 2018 results. The company expects to report income before income taxes of about €700 million ($834.8 million) and net income of nearly €400 million ($477 million) for the quarter.

Deutsche Bank expects the results to considerably exceed the average consensus estimate (as complied by Deutsche Bank) of €321 million ($382.8 million) for income before income taxes and €159 million ($189.6 million) for net income.

Total revenues for the second quarter are expected to be about €6.6 billion ($7.9 billion) compared with consensus estimate of €6.4 billion ($7.6 billion). Of the total revenues, €3.5 billion ($4.2 billion) are expected from Corporate & Investment Bank segment. The segment's sales & trading revenues are likely to decline 15% year over year whereas origination & advisory revenues are expected to increase 2%.

Notably, the segment's revenues will include a gain on an asset sale and debt valuation adjustments of €100 million ($119.3 million). This is indicative of expanding credit spreads of Deutsche Bank during the quarter.

The bank expects to incur noninterest expenses of nearly €5.8 billion ($6.9 billion), below the average consensus estimate of €6 billion ($7.2 billion). Of the total expenses, €0.2 billion ($0.2 billion) is projected as restructuring and severance costs.

Further, Deutsche Bank came up with preliminary capital ratios. Common Equity Tier 1 capital ratio is anticipated to be 13.6%, 3 basis points above the average consensus estimate. Notably, fully loaded leverage ratio is projected to be 3.9% compared to consensus expectation of 3.7%.

The company will be releasing full results for the second quarter on Jul 25.

Currently, Deutsche Bank carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

Among other foreign banks, UBS Group AG UBS will release second-quarter results on Jul 24 while Itau Unibanco Holding S.A. ITUB and HSBC Holdings plc HSBC will report on Jul 30.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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