U.S. Bancorp Earnings: Capital Building Process Accelerates, Profitability Outlook Dims Slightly

Wide-moat-rated U.S. Bancorp reported what we consider to be another average quarter. Third-quarter earnings per share of $0.91 was a slight miss versus the FactSet consensus estimate of $0.96 but was ahead of our own expectations due to lower provisioning. Net interest income, or NII, for the quarter was within 1% of our expectations, while fees and expenses were essentially in line. Deposit costs ran a little higher than we projected, although assuming we are getting to the end of the current rate cycle, we would expect funding movements to slow down.