Morgan Stanley (MS) and Goldman Sachs (GS) are scheduled to announce quarterly results on April 14, while Bank of America (BAC) is expected to report earnings on April 18. What to watch for:

OUTLOOK: During the company's last earnings call, Morgan Stanley said it saw $500M of incremental net interest income in wealth management this year and noted that long-term efficiency ratio goal was under 70%.When the company reported quarterly results back in January, Goldman Sachs said that it saw first-quarter buybacks "at or around" levels of the fourth quarter and strategic deal activity remaining high.

Meanwhile, Bank of America said during its last earnings call that it saw 2022 non-interest expense to approximate that of fiscal 2021, with first-quarter expenses expected to include seasonally elevated personnel costs of approximately $400M. The bank also said at the time that it saw "robust" net income interest growth in 2022 versus 2021, and fewer PPP fee benefits in the first quarter. Additionally, Bank of America said it saw a 2022 tax rate between 10%-12% and full-year loan growth in high single digits.

TARGET CUT AHEAD OF EARNINGS: Last week, Piper Sandler analyst Jeffrey Harte lowered the firm's price target on Morgan Stanley to $100 from $112, while keeping a Neutral rating on the shares. The analyst noted that he reduced earnings estimates for the universal banks ahead of the first quarter reports to reflect capital markets-related revenue headwinds amid an increase in macro uncertainty and market volatility since Russia invaded Ukraine in late February. Trading should be more resilient than investment banking in the first quarter, Harte told investors in a research note. Keeping Overweight ratings on both names, the analyst also lowered his price target on Bank of America and Goldman Sachs to $51 and $430, respectively, from $57 and $465, citing similar concerns.

Late last month, Morgan Stanley analyst Betsy Graseck had also lowered the firm's price target on Goldman Sachs to $418 from $445, maintaining an Equal Weight rating on the shares. In a note in which the U.S. Banks and Consumer Finance team at the firm said "War changes everything," the team also argued that higher for longer inflation increases credit risk, an inverted curve could slow growth and that they shift their bear case to recession, all of which led them to downgraded their industry view to In-Line from Attractive and adjusted a number of ratings and price targets across the group.

MOVING TO THE SIDELINES: Two weeks ago, Morgan Stanley analyst Betsy Graseck upgraded Bank of America to Equal Weight from Underweight with a price target of $49, down from $51. The analyst cited the bank's higher quality loan portfolio and above-average sensitivity to higher rates. Bank of America's long-held strategy of responsible growth comes with tighter underwriting standards and strong credit quality, Graseck contended.

Earlier that month, Baird analyst David George had also upgraded Bank of America to Neutral from Underperform with an unchanged price target of $42, stating that he found the U.S. bank group's risk/reward to be improving as elevated bank investor sentiment has cooled a bit in recent weeks, but "not enough to get aggressive yet." George highlighted Wells Fargo (WFC) and PNC Financial (PNC) as the U.S. banks he believed "look best to add on weakness."