Analyst Note| Eric Compton, CFA |
Narrow-moat rated Huntington reported second-quarter earnings which were very noisy due to the recent close of the TCF acquisition. While earnings missed FactSet consensus, we wouldn’t read much into this because there were so many moving parts due to the acquisition, and we expect earnings will continue to be noisy for the next several quarters as one-time charges flow through expenses and as yields and the balance sheet stabilize. Reported EPS of negative $0.05 included an initial provision of $294 million related to the TCF acquisition and $269 million of merger-related expenses. Excluding these items, adjusted EPS was $0.35, which compares favorably with the pre-pandemic run-rate of roughly $0.30 to $0.34.