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Decline in Fee Income to Hurt Huntington Bancshares' Q1 Earnings
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Huntington Bancshares Incorporated (HBAN - Free Report) is slated to report first-quarter 2025 results on April 17, before the opening bell. The company’s quarterly revenues and earnings are expected to have increased year over year.
In the last reported quarter, the bank recorded a positive earnings surprise of 9.7%. Results reflected improvements in fee income and net interest income (NII). However, an increase in the allowance for credit losses was a headwind.
HBAN has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average beat being 9.71%.
Huntington Bancshares Incorporated Price and EPS Surprise
The Zacks Consensus Estimate for Huntington Bancshares’ first-quarter earnings of 31 cents per share has been unchanged in the past seven days. The figure indicates a 10.7% decline from the year-ago reported number. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)
The consensus estimate for revenues is pegged at $1.90 billion, indicating a year-over-year rise of 7.3%.
Now, let us discuss factors that might have influenced Huntington Bancshares’ first-quarter performance.
Key Factors & Estimates for HBAN’s Q1 Result
Loans & NII: In the first quarter, the Federal Reserve kept interest rates unchanged at 4.25-4.5%. As such, HBAN’s NII might not have witnessed significant growth, given the relatively higher rates.
The Zacks Consensus Estimate for NII is pegged at $1.38 billion, indicating a 1% decrease on a sequential basis.
Per the Fed’s latest data, the demand for commercial and industrial loans and consumer loans was decent in the first quarter. This is expected to have supported Huntington Bancshares’ average interest-earning asset growth in the first quarter. The Zacks Consensus Estimate for average total earnings assets of $187.3 billion for the quarter under review indicates a 1.1% rise from the prior quarter’s reported level.
Non-Interest Income: Mortgage rates in the first quarter of 2025 were range-bound and hovered near 7%. As such, refinancing activities and origination volumes were decent. This is expected to have supported HBAN’s mortgage revenue growth in the quarter to be reported.
The Zacks Consensus Estimate for mortgage banking income is pegged at $31.2 million, suggesting a marginal rise from the prior quarter's reported figure.
Global merger and acquisition (M&A) activities in the first quarter of 2025 were not impressive. The initial optimism of a robust IB performance on the back of the Trump administration being business-friendly and the likelihood of tax cuts and deregulations quickly faded amid trade tensions and tariff uncertainties. This led to significant market volatility and economic uncertainty.
As such, companies became more cautious about pursuing M&A despite stabilizing rates and ample capital. Consequently, the company’s capital markets and advisory fees are expected to have declined in the first quarter.
The Zacks Consensus Estimate for capital markets and advisory fees is pegged at $75.3 million, indicating a 37% fall on a sequential basis.
The Zacks Consensus Estimate for wealth and asset management revenues is pegged at $94.5 million, indicating a 1.6% rise from the prior quarter’s reported figure.
The consensus estimate for customer deposit and loan fees for the first quarter is pegged at $85.4 million, indicating a 2.9% sequential rise.
The consensus mark for insurance income of $18.8 million implies a 14.5% decline from the quarter-ago reported figure.
The consensus mark for total non-interest income is pegged at $511.9 million, indicating an 8.4% fall from the year-ago quarter’s reported level.
Expenses: Huntington Bancshares’ higher expenses from outside data processing and other services, and deposit and marketing expenses are anticipated to have raised its costs in the first quarter. Also, the bank’s efforts to expand its commercial banking capabilities in high-growth markets by adding more branches and hiring professionals are expected to have contributed to increased expenses.
Though efficiency initiatives are likely to reduce expenses to some extent, long-term investments in key growth initiatives are expected to have kept the company’s expense base higher.
Asset Quality: HBAN is likely to have set aside a substantial amount of money for potential delinquent loans, given the expectations of an economic slowdown and tariff-related uncertainty.
The Zacks Consensus Estimate for total non-accrual loans of $789 million indicates a 1% increase from the prior quarter's reported figure.
What Does Our Model Unveil for HBAN?
Our quantitative model does not conclusively predict an earnings beat for Huntington Bancshares this time. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Huntington Bancshares has an Earnings ESP of -2.16%.
Zacks Rank: HBAN currently carries a Zacks Rank of 3.
Stocks to Consider
Here are some bank stocks that you may want to consider, as our model shows that these have the right combination of elements to post earnings beat this time around.
The Earnings ESP for U.S. Bancorp (USB - Free Report) is +0.94% and it carries a Zacks Rank #3 at present. The company is slated to report first-quarter 2025 results on April 16.
Over the past seven days, the Zacks Consensus Estimate for U.S. Bancorp’s quarterly earnings has been unchanged at 99 cents.
Image: Bigstock
Decline in Fee Income to Hurt Huntington Bancshares' Q1 Earnings
Huntington Bancshares Incorporated (HBAN - Free Report) is slated to report first-quarter 2025 results on April 17, before the opening bell. The company’s quarterly revenues and earnings are expected to have increased year over year.
In the last reported quarter, the bank recorded a positive earnings surprise of 9.7%. Results reflected improvements in fee income and net interest income (NII). However, an increase in the allowance for credit losses was a headwind.
HBAN has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average beat being 9.71%.
Huntington Bancshares Incorporated Price and EPS Surprise
Huntington Bancshares Incorporated price-eps-surprise | Huntington Bancshares Incorporated Quote
The Zacks Consensus Estimate for Huntington Bancshares’ first-quarter earnings of 31 cents per share has been unchanged in the past seven days. The figure indicates a 10.7% decline from the year-ago reported number. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)
The consensus estimate for revenues is pegged at $1.90 billion, indicating a year-over-year rise of 7.3%.
Now, let us discuss factors that might have influenced Huntington Bancshares’ first-quarter performance.
Key Factors & Estimates for HBAN’s Q1 Result
Loans & NII: In the first quarter, the Federal Reserve kept interest rates unchanged at 4.25-4.5%. As such, HBAN’s NII might not have witnessed significant growth, given the relatively higher rates.
The Zacks Consensus Estimate for NII is pegged at $1.38 billion, indicating a 1% decrease on a sequential basis.
Per the Fed’s latest data, the demand for commercial and industrial loans and consumer loans was decent in the first quarter. This is expected to have supported Huntington Bancshares’ average interest-earning asset growth in the first quarter. The Zacks Consensus Estimate for average total earnings assets of $187.3 billion for the quarter under review indicates a 1.1% rise from the prior quarter’s reported level.
Non-Interest Income: Mortgage rates in the first quarter of 2025 were range-bound and hovered near 7%. As such, refinancing activities and origination volumes were decent. This is expected to have supported HBAN’s mortgage revenue growth in the quarter to be reported.
The Zacks Consensus Estimate for mortgage banking income is pegged at $31.2 million, suggesting a marginal rise from the prior quarter's reported figure.
Global merger and acquisition (M&A) activities in the first quarter of 2025 were not impressive. The initial optimism of a robust IB performance on the back of the Trump administration being business-friendly and the likelihood of tax cuts and deregulations quickly faded amid trade tensions and tariff uncertainties. This led to significant market volatility and economic uncertainty.
As such, companies became more cautious about pursuing M&A despite stabilizing rates and ample capital. Consequently, the company’s capital markets and advisory fees are expected to have declined in the first quarter.
The Zacks Consensus Estimate for capital markets and advisory fees is pegged at $75.3 million, indicating a 37% fall on a sequential basis.
The Zacks Consensus Estimate for wealth and asset management revenues is pegged at $94.5 million, indicating a 1.6% rise from the prior quarter’s reported figure.
The consensus estimate for customer deposit and loan fees for the first quarter is pegged at $85.4 million, indicating a 2.9% sequential rise.
The consensus mark for insurance income of $18.8 million implies a 14.5% decline from the quarter-ago reported figure.
The consensus mark for total non-interest income is pegged at $511.9 million, indicating an 8.4% fall from the year-ago quarter’s reported level.
Expenses: Huntington Bancshares’ higher expenses from outside data processing and other services, and deposit and marketing expenses are anticipated to have raised its costs in the first quarter. Also, the bank’s efforts to expand its commercial banking capabilities in high-growth markets by adding more branches and hiring professionals are expected to have contributed to increased expenses.
Though efficiency initiatives are likely to reduce expenses to some extent, long-term investments in key growth initiatives are expected to have kept the company’s expense base higher.
Asset Quality: HBAN is likely to have set aside a substantial amount of money for potential delinquent loans, given the expectations of an economic slowdown and tariff-related uncertainty.
The Zacks Consensus Estimate for total non-accrual loans of $789 million indicates a 1% increase from the prior quarter's reported figure.
What Does Our Model Unveil for HBAN?
Our quantitative model does not conclusively predict an earnings beat for Huntington Bancshares this time. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or higher. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Huntington Bancshares has an Earnings ESP of -2.16%.
Zacks Rank: HBAN currently carries a Zacks Rank of 3.
Stocks to Consider
Here are some bank stocks that you may want to consider, as our model shows that these have the right combination of elements to post earnings beat this time around.
The Earnings ESP for U.S. Bancorp (USB - Free Report) is +0.94% and it carries a Zacks Rank #3 at present. The company is slated to report first-quarter 2025 results on April 16.
Over the past seven days, the Zacks Consensus Estimate for U.S. Bancorp’s quarterly earnings has been unchanged at 99 cents.
First Horizon (FHN - Free Report) is also scheduled to announce quarterly numbers on April 16. The company carries a Zacks Rank #3 at present and has an Earnings ESP of +3.80%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quarterly earnings estimates for First Horizon have been unchanged at 40 cents over the past week.