Jonathan Corpina - Senior Managing Partner, Meridian Equity Partners
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Benzinga's PreMarket Prep is the #1 go-to source for everything you need to know before the market opens! Join our expert hosts as they break down the latest market trends, analyze key indicators, and provide actionable insights to help you navigate the trading day ahead.
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00:00All right, Jonathan.
00:01Yes, sir.
00:02I know it's early.
00:03Q3 earnings season is upon us here.
00:07Start with the banks, which are the banks of the banks here.
00:11Give us your take on the banking sector, the earnings here, and what you're looking for
00:16for the remainder of Q3 earnings reports.
00:18Yeah.
00:19Historically, earnings help our markets a little bit, settles things down.
00:23I think over quite some time now, the economic numbers that we get from earnings aren't as
00:29important.
00:30It's the outlook moving forward.
00:31And we kind of get these benign statements in earnings reports about what the outlook
00:35is going to be when you're talking about interest rates and geopolitical issues and exposure
00:40that's out there.
00:41So I think earnings are great.
00:44The season does help.
00:45It does add a little euphoria to our markets.
00:48But I think we're kind of still in this very benign way of kind of treading of what next
00:54quarter is going to look like, what the outlook is going to look like.
00:57And I think the earnings, CFOs use that excuse for uncertainty moving forward, which might
01:04spook a little into the markets, and sometimes it is warranted.
01:07But I think overall, what we normally hear, what we look for, yes, is the growth.
01:14But it's more of the outlook moving forward.
01:16And when you're talking about the financials here, financials have had a pretty good run
01:20to them.
01:21It's somewhat choppy at some point.
01:23But I think overall, it's good.
01:24As we're getting towards the end of the year, it's going to be very exciting to see and
01:28interesting to see if M&A activity picks up, right, as we get towards the end of the year.
01:32And we've done this before.
01:34And it's all kind of tied to, you know, the economy and what's going on there and what's
01:40going on in the markets.
01:41M&A has been quiet.
01:43And we're starting to hear a little bit more now of some of these sideline companies that
01:49are starting to kick the tires of starting to go public.
01:52It's kind of a weird dynamic in 2024 now, because as the market has performed well throughout
01:57the year and we've had these bumps along the way, we've taken two steps forward and one
02:01step back, you know, when is that right time?
02:05And as we're getting close to an election, 24 days, and as of now, we don't have to debate
02:10whether the polls are right, but the polls are saying 50-50-ish.
02:15So you know, if you're a company, you're probably more inclined to wait and see what's going
02:20to happen.
02:21But if M&A activity does pick up, whether it's going to be in the, you know, the next
02:25quarter or two, or if they punt it down, down the road, you know, that certainly will help
02:30the banks.
02:31That will come back.
02:32So it might be kind of an early play getting into those banks, because once that M&A activity
02:36starts to really pick up and come into play, we're going to see earnings and revenue.
02:43And that's, you know, for the financials, that's where they make a really decent area
02:47of their money.
02:48I think that's going to be very beneficial for that sector.
02:52What about the institutional customer?
02:53Are they still excited for bank earnings?
02:54Yeah, I'll kind of, I'll kind of date myself.
02:56And I think you guys, you know, remember back when Alcoa was the first learning report that
03:01used to come out.
03:02Klaus Kleinfeld!
03:03And that was, that was like, OK, this is whatever Alcoa says, that's how earnings season's
03:07going to be.
03:08So that goes away.
03:09Then it went to the financials.
03:10You know, Jill, Dennis, I think that what you're saying is right.
03:14I think we kind of look to the financials.
03:17Does it really set the tone?
03:19Maybe, maybe it does.
03:21Maybe it doesn't.
03:22But then you start really waiting for those, those big bellwether name stocks, those household
03:26names, the Apples, the Amazons, the Netflix, the NVIDIAs.
03:30Those are the ones that really get excitement into the market, both from a recognition point
03:36of view.
03:37I think people can really relate to that.
03:39And also from the fact that whether you agree with it or not, those are names that really
03:44kind of move the markets and kind of set the tones for the market.
03:47So they're kind of spread out over time.
03:49I don't think we get that same, you know, lead off batter that we used to get before
03:53in the past that would set the tone.