NYSE$USB

US Bancorp · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Reported fourth quarter and full year results, demonstrating resilience amidst economic challenges.

U.S. Bancorp reported a net income of $1,519 million and diluted earnings per share of $0.95 for Q4 2020. The results reflected the strength of the diversified business model, delivering industry-leading results despite economic headwinds. Full year revenue reached a record $23.3 billion, with net income of $4.959 billion.

  • Net income attributable to U.S. Bancorp was $1,519 million for the fourth quarter of 2020, 2.2 percent higher than the fourth quarter of 2019.
  • Diluted earnings per common share were $0.95 in the fourth quarter of 2020, compared with $0.90 in the fourth quarter of 2019.
  • Net revenue was $5,751 million, including $3,201 million of net interest income and $2,550 million of noninterest income in 4Q20.
  • The company's CET1 capital ratio increased to 9.7% at December 31, 2020, compared with 9.1% at December 31, 2019.

Headline financials

Total Revenue

$5.73B

Previous: $5.64B+1.5%
EPS (adj)

$0.95

Previous: $1.08-12.0%
Net Interest Margin

2.6%

Previous: 2.9%-12.0%
Return on Avg Assets

1.1%

Previous: 1.2%-9.1%
Return on Common Equity

12.1%

Previous: 11.8%+2.5%
Efficiency Ratio

58.8%

Previous: 60.3%-2.5%
Net Charge-Off Ratio

0.6%

Previous: 0.5%+11.5%
CET1 Capital Ratio

9.7%

No prior period
Net Income

$1.53B

Previous: $1.49B+2.1%
Cash & Equivalents

$62.6B

No prior period
Total Assets

$554B

No prior period

Revenue & EPS history

US Bancorp · Revenue · Quarterly

$5.73B

Q4 2020+1.5%vs Q4 2019
Beat estimate in 15 of 16 quarters(94%)
ActualEstimate

Revenue by segment

US Bancorp · $4.53B total across 3 segments · Q3 2023

  • Consumer & Business
    $2.48B+20.0%
  • Payment Services
    $1.73B+6.7%
  • Treasury & Corporate
    $323M+0.0%

Forward guidance

U.S. Bancorp anticipates continued investment in digital capabilities, technology, and people to drive revenue growth and efficiency improvement in 2021.

Tailwinds

  • Maintaining its current quarterly dividend of $0.42 per common share.
  • Beginning repurchasing common shares in the first quarter of 2021 under a previously announced $3 billion common stock repurchase program.
  • The company's results for the December 2020 stress test reflected the strength of its balance sheet, its diverse businesses and strong financial discipline.
  • The company remains subject to the minimum stress capital buffer of 2.5 percent.
  • U.S. Bank Mobile App was ranked No. 1 in customer service features in Business Insider Intelligence’s fourth annual US Mobile Banking Competitive Edge Study.

Headwinds

  • COVID-19 environment resulting in significantly lower interest rates and consumer and business spending activities.
  • Changes in credit quality due to COVID-19.
  • Net interest margin declined from a year ago to 2.57 percent in the fourth quarter of 2020 primarily due to the impact of a lower yield curve, loan mix, decisions to maintain higher levels of liquidity, and higher premium amortization within the investment portfolio, partially offset by the net benefit of deposit repricing and funding composition.
  • Noninterest expense decreased 1.1 percent despite approximately $22 million of costs related to the COVID-19 environment and an increase in revenue-related production expenses of approximately $96 million in the fourth quarter of 2020.
  • Nonperforming assets are expected to remain elevated and volatility in net charge-offs is expected given current economic conditions.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

+0.0%

Avg return

Earnings day

+0.3%

Avg return

5 days after

+2.2%

Avg return

30 days after

54%

39 / 72 earnings

Positive

+7.1%

Q2 2023

Best reaction

-11.2%

Q1 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.0%+0.8%-5.8%
Q3 2025-1.8%+2.5%+1.4%
Q2 2025+0.5%-0.9%+5.4%
Q1 2025-2.1%-2.1%+16.3%
Q4 2024-5.0%-3.1%-6.2%
Q3 2024+6.3%+2.0%+6.2%
Q2 2024+2.6%+4.0%-0.2%
Q1 2024-3.8%+0.1%+1.0%
Q4 2023-3.0%+1.0%+0.3%
Q3 2023-6.1%-10.4%+7.9%
Q2 2023+7.1%+7.4%+0.8%
Q1 2023-1.2%-6.8%-14.4%
Q4 2022+4.3%+4.6%+2.1%
Q3 2022+3.1%-0.3%+8.6%
Q2 2022+5.5%+6.3%+10.2%
Q1 2022+4.2%+4.5%-4.0%
Q4 2021-8.4%-8.7%-8.2%
Q3 2021-2.0%-0.2%-1.6%
Q2 2021+0.3%-1.6%+2.2%
Q1 2021+0.5%-2.4%+7.5%
Q4 2020-5.0%-4.8%+4.1%
Q3 2020+1.9%+1.4%+12.7%
Q2 2020+3.5%-2.0%+4.1%
Q1 2020-11.2%-4.3%-14.3%
Q4 2019-2.5%-2.2%-2.6%
Q3 2019+1.8%+4.5%+9.9%
Q2 2019+4.1%+4.3%-1.4%
Q1 2019+1.8%+1.8%+2.5%
Q4 2018+3.7%+4.7%+7.0%
Q3 2018+2.3%+0.9%+7.7%
Q2 2018+0.1%+1.1%+3.9%
Q1 2018-0.6%-0.9%-0.9%
Q4 2017-1.8%+0.2%-2.7%
Q3 2017-0.5%+0.5%-3.7%
Q2 2017+1.6%+2.2%+0.1%
Q1 2017+1.8%+3.5%+2.6%
Q4 2016+0.8%+1.3%+9.1%
Q3 2016+2.2%+2.3%+14.5%
Q2 2016+1.5%+1.7%+3.6%
Q1 2016+1.6%
Q4 2015-2.0%
Q3 2015+0.7%
Q2 2015+4.5%
Q1 2015-1.4%
Q4 2014+5.4%
Q3 2014+0.3%
Q2 2014-3.9%
Q1 2014-1.9%
Q4 2013-2.1%
Q3 2013+2.2%
Q2 2013-0.5%
Q1 2013-2.8%
Q4 2012-1.6%
Q3 2012+2.4%
Q2 2012+2.6%
Q1 2012+0.4%
Q4 2011-0.3%
Q3 2011+1.1%
Q2 2011-1.5%
Q1 2011+0.0%
Q4 2009-1.5%
Q4 2008-1.5%
Q4 2010-1.5%
Q2 2010-1.5%
Q3 2010-3.4%
Q1 2009+4.2%
Q1 2010+1.5%
Q4 2007+0.9%
Q3 2009+2.2%
Q3 2008+2.2%
Q2 2008-4.9%
Q2 2009-4.9%

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