Citigroup and GE Q1 Reports Beat Analyst Estimates; Another Index Reports Increase in Consumer Confidence
by Anne Szustek
Feel-good business and financial news of April 17, 2009: Citigroup and GE’s first-quarter reports surpass projections; the Reuters/University of Michigan preliminary consumer sentiment index shows shoppers are feeling better about the economy.
Citigroup posted first-quarter losses of $0.18 per share, below the average forecast of $0.34. “Citi's first-quarter results reflected better operating margins,” writes BusinessWeek. “U.S. deposits rose by $28 billion and revenues nearly doubled from a year ago, to $24.8 billion.” This news comes a day after JPMorgan Chase reported a 48 percent increase in revenue during the first three months of this year and Regions Bank said that, contrary to earlier expectations, it expected to post first-quarter profits.
General Electric’s profits from continuing operations declined by 35 percent year-on-year during the first quarter of this year, down to $2.83 billion, or $0.26 per share “from $4.35 billion, or 43 cents, a year earlier,” reports Bloomberg. The conglomerate still surpassed the average analyst estimate of a decline to $0.21 cents per share, according to a Bloomberg survey. GE’s energy and technology infrastructure units did see rises in profit, of 19 percent and 6 percent, respectively. Steven Winoker, a senior analyst at New York financial research firm Sanford C. Bernstein wrote in a note to clients cited by Bloomberg, “We view this morning’s results, order rates and backlog positively despite lower revenue and mixed quality of earnings.”
The Reuters/University of Michigan preliminary consumer sentiment index for the month of April topped estimates, coming out at 61.9 instead of 57.5 as expected. Even the projected score still beat March’s reading of 57.3, suggesting consumers are feeling more confident. The Wall Street Journal writes that “the increase was likely tied to robust gains in stock markets and increasing evidence that the worst of the economy's slide into recession may be over,” and Wachovia chief economist John Silvia was quoted by the paper as saying that the index reading perhaps indicates “better times ahead.” The news comes less than two weeks after another measure, the IBD/Tipp index, also indicated increased consumer confidence.