Macroaxis Stories

Is PNC riskier than Truist Financial Corp (USA Stocks:TFC)?

October 15, 2024  By Raphi Shpitalnik
Macroaxis Story
When it comes to choosing between PNC Financial Services and Truist Financial Corp, the devil is in the details. PNC Financial Services, with a market capitalization of $74.9 billion, stands as a formidable player in the regional banking sector. Despite its challenges, including a slight operating margin of 0.35%, PNC's robust net interest income of $14.2 billion showcases its ability to generate revenue from its core banking operations. As investors weigh their options, understanding PNC's financial health and strategic positioning becomes crucial in determining whether it offers a more compelling investment opportunity compared to its peers. Truist Financial's stock climbed 1.58% today, while PNC Financial saw a 3.06% increase. While some investors might get caught up in dissecting the competition among banks, it's worth considering both PNC Financial and Truist Financial for short-term investment opportunities. Let's explore some of the competitive factors that make these two banks intriguing options.
Published over a month ago
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Reviewed by Gabriel Shpitalnik

By comparing key indicators between PNC Financial and Truist, you can assess how market fluctuations impact their stock prices and determine if combining them in a portfolio could reduce market risk. Pair trading is another strategy to consider, where you could balance a long position in Truist with a short position in PNC Financial. For more details, explore our [pair correlation module](#). Now, let's look at asset performance. Asset utilization measures how much revenue a company generates from its assets. As of October, PNC's return on assets suggests they aren't using their assets as effectively as they could be.

Major Takeaways

Considering an investment in PNC Financial Services, it's worth noting that the company boasts a robust net income from continuing operations of 6.3B, reflecting its strong profitability. Additionally, with a market capitalization of 74.9B, PNC stands as a significant player in the regional banking sector, offering a solid foundation for potential investors.
Investment perspective, in general, refers to a viewpoint or opinion regarding investment opportunity in PNC Financial. It encompasses the assessment of an investment's potential risks and rewards, and expectations for its performance over time. Several factors influence the investment perspective on PNC Financial, including investment goals, risk tolerance, time horizon, market conditions, and research and analysis. Investors have varying goals, such as capital preservation, income generation, or long-term growth. Risk tolerance plays a significant role in shaping an investor's perspective, with some being more risk-averse and others willing to take on higher risks for potential returns.

How important is PNC Financial's Liquidity

PNC Financial financial leverage refers to using borrowed capital as a funding source to finance PNC Financial Services ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. PNC Financial financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to PNC Financial's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of PNC Financial's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between PNC Financial's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions. It is good to see analyst projects for PNC Financial, but it might be worth checking our own buy vs. sell analysis

PNC Financial Gross Profit

PNC Financial Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing PNC Financial previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show PNC Financial Gross Profit growth over the last 10 years. Please check PNC Financial's gross profit and other fundamental indicators for more details.

Breaking it down a bit more

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Let me take a closer look at PNC Financial revenue. Based on the latest financial disclosure, PNC Financial Services reported 21.51 B of revenue.
This is 91.88% higher than that of the Banks sector and significantly higher than that of the Financials industry. The revenue for all United States stocks is 127.97% lower than that of PNC Financial Services. As for Truist Financial we see revenue of 33.33 B, which is much higher than that of the Financials
PNC21.51 Billion
Sector0.0
Truist33.33 Billion
21.5 B
PNC
Sector
33.3 B
Truist
Warren Buffett once said that risk comes from not knowing what you're doing, a sentiment that resonates when evaluating PNC Financial Services against Truist Financial Corp. PNC, with a solid net asset base of $561.58 billion and a stable cash flow from operations of $10.11 billion, offers a robust financial footing. The company's return on assets is 0.95%, reflecting efficient management of its resources. While PNC's operating margin is a modest 0.35%, its price-to-earnings ratio of 8.70x suggests it may be undervalued compared to peers. In contrast, investors should weigh these metrics against Truist's performance to determine which stock aligns better with their risk appetite and investment goals..

Another 3 percent surge for PNC Financial

PNC Financial Services recently saw a 3% uptick in its stock, catching the eye of investors amid market shifts. Notably, its semi deviation—a measure of downside risk—has dropped to 1.27, indicating reduced volatility on the downside. This suggests a more stable risk profile, which could attract investors looking to ride PNC's upward trend while keeping risks in check. This improved stability might make PNC Financial more appealing for portfolios. As of October 15, 2024, PNC's market risk-adjusted performance stands at 0.1428.
The technical analysis tools available allow investors to explore PNC's key technical drivers and their interconnections, providing deeper insights into its performance.Considering the current landscape for PNC Financial Services, the stock presents a compelling opportunity for investors. With a strong analyst consensus rating of "Buy" and a notable number of strong buy recommendations at 9, there's a solid foundation of confidence in its potential. While the highest estimated target price sits at 153.16, indicating some room for growth, it's essential to weigh this against the possible downside price of 192.15. As we approach the fiscal year-end in December, investors should keep an eye on market conditions and company performance. Overall, PNC Financial seems poised for a positive trajectory, but as always, it's crucial to balance optimism with careful consideration of market dynamics..

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Editorial Staff

Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI. View Profile
This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of PNC Financial Services. Please refer to our Terms of Use for any information regarding our disclosure principles.

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