We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Deutsche Bank (DB) Disappoint This Earnings Season?
Read MoreHide Full Article
Deutsche Bank AG (DB - Free Report) is scheduled to report fourth-quarter 2017 results on Feb 2.
In the last reported quarter, the German banking giant reported net income, driven by cost management and reduction in provisions. However, lower revenues due to trading slump were an undermining factor.
Deutsche Bank is expected to report annual loss consecutively for the third year in 2017, as its results might be impacted by change in tax rates and dismal performance of the investment banking segment. Elevated legal expenses during the final quarter of 2017 also played a role in wiping out profits.
CEO John Cryan of the Germany-based lender has been trying to turnaround the bank through cost-saving measures and focus on investment banking. However, unfavorable trading environment and prevalent legal matters affected his plans and put him on the verge of dismissal.
Factors to Influence Q4 Results
Slump in Trading Activities: During the fourth quarter, trading environment was disappointing as markets experienced low volatility due to several factors. The bank’s revenues are likely to face fixed-income trading slump. Moreover, trading in equities is expected to witness a downtrend due to decreased client activities. Notably, the company expects fixed income, equity and financing revenues to drop 22% from the prior-year period.
Impact of Tax Reform: Deutsche Bank expects the drop in tax rate in U.S. to adversely affect its financials by €1.5 billion due to revaluation of deferred tax assets. Further, the bank estimates the tax overhaul to weaken its capital position. Common Equity Tier 1 ratio is predicted to contract 10 basis points. Per the bank, reduction in tax rates will likely lead to a fall in its effective tax rate to the lower end of the previously expected range of 30-35%.
Legal Issues: Deutsche Bank’s struggle with legal matters continues to impact its bottom line. For the fourth quarter, the bank expects a €0.5-billion hit from legal proceedings.
Among other foreign banks, Mitsubishi UFJ Financial Group, Inc. , Itau Unibanco Holding S.A. (ITUB - Free Report) and The Royal Bank of Scotland Group plc are scheduled to report results on Feb 2, Feb 6 and Feb 23, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Will Deutsche Bank (DB) Disappoint This Earnings Season?
Deutsche Bank AG (DB - Free Report) is scheduled to report fourth-quarter 2017 results on Feb 2.
In the last reported quarter, the German banking giant reported net income, driven by cost management and reduction in provisions. However, lower revenues due to trading slump were an undermining factor.
Deutsche Bank is expected to report annual loss consecutively for the third year in 2017, as its results might be impacted by change in tax rates and dismal performance of the investment banking segment. Elevated legal expenses during the final quarter of 2017 also played a role in wiping out profits.
CEO John Cryan of the Germany-based lender has been trying to turnaround the bank through cost-saving measures and focus on investment banking. However, unfavorable trading environment and prevalent legal matters affected his plans and put him on the verge of dismissal.
Factors to Influence Q4 Results
Slump in Trading Activities: During the fourth quarter, trading environment was disappointing as markets experienced low volatility due to several factors. The bank’s revenues are likely to face fixed-income trading slump. Moreover, trading in equities is expected to witness a downtrend due to decreased client activities. Notably, the company expects fixed income, equity and financing revenues to drop 22% from the prior-year period.
Impact of Tax Reform: Deutsche Bank expects the drop in tax rate in U.S. to adversely affect its financials by €1.5 billion due to revaluation of deferred tax assets. Further, the bank estimates the tax overhaul to weaken its capital position. Common Equity Tier 1 ratio is predicted to contract 10 basis points. Per the bank, reduction in tax rates will likely lead to a fall in its effective tax rate to the lower end of the previously expected range of 30-35%.
Legal Issues: Deutsche Bank’s struggle with legal matters continues to impact its bottom line. For the fourth quarter, the bank expects a €0.5-billion hit from legal proceedings.
Deutsche Bank AG Price
Deutsche Bank AG Price | Deutsche Bank AG Quote
Currently, Deutsche Bank currently 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, Mitsubishi UFJ Financial Group, Inc. , Itau Unibanco Holding S.A. (ITUB - Free Report) and The Royal Bank of Scotland Group plc are scheduled to report results on Feb 2, Feb 6 and Feb 23, respectively.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>