Which of These 5 Mega-Bank Stocks have the Strongest Earnings Trends?

Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

Stocks with improving earnings metrics are worthy of your extra attention. Click here to discover our CHEAT SHEET stock picks now!

Here’s your Cheat Sheet to how the top 5 bank stocks rank via earnings trends:

UBS AG (NYSE:UBS): Current Price $16.84

Fiscal Year 2007 2008 2009 2010 2011
Revenue ($) in millions 113,420 106,680 37,250 42,980 46,290
Diluted EPS ($) -1.81 -6.59 -0.70 1.96 1.19

The impact of the financial crisis is starkly visible on UBS’s numbers. Although, revenue numbers have gained steadily. EPS jumped nicely in 2010, but lost a bit in 2011.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Sep. 30, 2011 Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012
Revenue ($) in millions 10,170 10,920 9,934 11,020 6,110
Diluted EPS ($) 0.30 0.11 0.24 0.11 -0.62

Obviously, UBS faced a rough quarter in September 2012, when both revenue and EPS went off the cliff. Not the kind of bank we can include on our list…