Three Factors Drive BofA Net Higher 32%, Harris to Merge with L3 Tech

Mukesh Buch
15 Oct, 2018
New York City

Bank of America beat profit estimates on cost reductions. Charles Schwab reported record results after net surged 49%. Harris Corp agreed to merge with L3 Technologies. Walmart acquired online lingerie retailer Bare Necessities.

[R]12:55 PM New York City, New York – Bank of America beat profit estimates on cost reductions. Charles Schwab reported record results after net surged 49%. Harris Corp agreed to merge with L3 Technologies. Walmart acquired online lingerie retailer Bare Necessities.[/R]

Tollbooth Index edged down 12.95 to 15,585.43 but soared 13.3% in the year so far.

Earnings Review

Bank of America Corporation ((BAC)) dropped 1.9% or 54 cents to $27.93 after the banking and financial services provider reported revenues in the third-quarter ending in September jumped 4% from a year ago at $22.8 billion.

Net income in the quarter soared 32% to $7.2 billion or 66 cents per diluted share from $6.8 billion or 63 cents in the same quarter last year.

The bank said higher profit was driven by strong operating leverage, asset quality and tax reform benefit as pre-tax profit surged 18% to $9 billion and provision for credit losses decreased by $118 million to $716 million and net charge-off ratio remained low at 0.40%.

The lender said average loan and lease balances in business segments increased 3% to $871 billion and average deposit advanced 4% to $1.3 trillion.

Charles Schwab Corporation ((SCHW)) dropped 1.3% or 62 cents to $48.40 after the brokerage and asset-manager said net revenues in the third-quarter ending in September soared 19% from a year ago at $2.6 billion.

Net income in the quarter surged 49% to $923 million or 65 cents per diluted share from $618 million or 42 cents in the same quarter last year.

Harris Corporation ((HRS)) soared 8.9% or $13.76 to $168.83 after the defense contractor agreed to merge with L3 Technologies, Inc in an all-stock deal and valuing the company with a market capitalization of $33.5 billion.

Under the terms, each L3 Technologies shareholder will receive 1.30 shares of Harris Corp.

L3 Technologies, Inc stock jumped 9.1% to $213.54.

KMG Chemicals Inc ((KMG)) rose 10 cents to $74.28 after the specialty chemical products supplier stated revenues in the fourth-quarter ending in July surged 27.1% from a year ago to $122.4 million.

Net income in the quarter soared to $18.1 million or $1.13 per diluted share from $5.3 million or 43 cents in the same quarter last year.

KMG Chemicals operating margin jumped 18.94% from 11.2% in the same period a year ago.

Walmart Inc ((WMT)) fell 72 cents to $94.10 and the retailing giant announced the purchase of online intimates lingerie retailer Bare Necessities for an undisclosed amount.