With third-quarter earnings season winding down for the nation's biggest banks, investors can now get a sense for how companies like US Bancorp (NYSE:USB), Wells Fargo (NYSE:WFC), and JPMorgan Chase (NYSE:JPM) stacked up against their peers in the three months ended Sept. 30.
As you'll see in the slideshow below, the answer for these three banks was: quite good. Building on past successes, US Bancorp, Wells Fargo, and JPMorgan Chase were the most profitable big banks in the country last quarter, when measured by return on average common equity (ROACE). The benchmark to keep in mind in this regard is 10%, which equates to the typical bank's cost of capital. If a firm's ROACE exceeds this, as US Bancorp, Wells Fargo, and JPMorgan Chase all successfully did, then it is said to have created value for shareholders. Come up short, however, and value is destroyed.
To discover the other two most profitable big banks in America, simply scroll through the short slideshow below.
John Maxfield has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
More from The Motley Fool
These Bank Bets Put Even Bitcoin to Shame
Find out why you have less than a year left to use some of these unusual investments.
JPMorgan Chase (JPM) Q4 2017 Earnings Conference Call Transcript
JPM earnings call for the period ending December 31, 2017.
What Happened in the Stock Market Today
As stocks closed a record-breaking week with more big gains, shares of JPMorgan Chase and BlackRock rose after the companies reported earnings.