Earnings Preview: SunTrust Banks

SunTrust Banks (STI) is expected to report Q3 earnings before market open Thursday Oct. 23, with a conference call scheduled for 8:00 am.

Guidance

Analysts are looking for EPS of 60c on revenue of $2.12B. The consensus range for EPS is 32c to 97c, while the consensus range for revenue is $1.98B to $2.16B, according to First Call.

Analyst Views

The U.S. Treasury may try to use its $250B bank rescue package as leverage in order to encourage SunTrust to acquire weaker banks, The New York Times recently reported. Conversely, the Atlanta Journal Constitution recently reported that SunTrust would become a takeover target itself in the long term.

A number of research firms recently upgraded the bank after the government announced that it would inject capital into U.S. banks. Citigroup raised the bank to Buy from Sell, while Robert W. Baird upgraded the bank to Outperform from Neutral, and Morgan Keegan raised it to Outperform from Market Perform. On October 13, Keefe Bruyette upgraded SunTrust to Market Perform from Underperform. The firm said it did not believe that the bank's stock could drop much further.