J P Morgan Chase (JPM) stock: should you buy the dip?

6:09 am ET, 13 Oct 2018

J P Morgan Chase & Co (JPM) shares are trading at $109.40, down -1.82%. The company is announcing its quarterly earnings results on Friday before the market opens. What's driving JPM stock price? What's JPM stock price forecast?

JP Morgan Chase has maintained the leadership position in the U.S. banking industry. Lately, the stock has performed well: it generated a return of 17% in the past year.  Over the period of last 10 years, JP Morgan has outperformed the S&P 500 index and its banking competitors.

Investors are buying the shares because the bank has a solid shareholder return. JP Morgan also increased the quarterly dividend recently. On the other hand, some investors worry about the rising regulatory concerns surrounding the banking industry. JPM's last quarter’s revenue rose 10% to $28.4 billion, earnings per share came at $2.29 compared to $1.82.  The return on equity was 14% compared to 12% for the same period last year.

Third-quarter results will be released before market open on October 12, 2018. Analysts expect the company to earn $2.27 per share on revenue of $27.66 billion. The company beat analysts’ estimates in the previous four quarters.

What is the sentiment towards the JPM stock? Our technical analysis shows that: 

  • The stock short-term sentiment (next 30 days) is trending negative;
  • The mid-term sentiment (3-6 months) is trending positive;
  • The long-term sentiment (9-12 months) is trending positive. 

Over the last month, J P Morgan Chase & Co (JPM) returned -2.84%.

J P Morgan Chase & Co (JPM) average analyst price target ($120.64) is 6.91% above its current price ($112.84).

For the latest price and information on J P Morgan Chase & Co, please visit Finstead and search for "JPM price" or "JPM news".

Bank of America (BAC) earnings preview: expect revenue decline

4:24 am ET, 12 Jul 2018

Bank of America Corporation (BAC)  is expected to report earnings on July 16 before market open.  The report will be for the fiscal quarter ending June 2018.  Shares are trading at 28.83, down -0.76% from yesterday.

What are the BAC earnings expectations?  What news will the market be watching out for?  

Bank of America's strategy of simplification, efficiency, and risk reduction has slowly begun to pay off. Assets have remained fairly flat since 2009.  Management increased the bank's Tier 1 common ratio dramatically, closed nearly 25% of branches, and trimmed personnel dramatically. 

The bank's lending practices have also been revamped. Consumer loans are now made largely to customers with average FICO scores over 750, while the average American's score was 50 points lower.

Scale and scope advantages are increasingly important as the role of technology in banking grows. Bank of America generated noninterest income averaging just under 2% of total assets over the last three years, in line with JPMorgan Chase and not too far behind U.S. Bancorp and Wells Fargo, each averaging 2.2% of assets in fee income. Expenses are continuing to decline even as revenue grows.

The biggest risk to Bank of America's new, more conservative strategy is that its peers seem to be following the same playbook.  Competition for high-end credit card customers has increased, with firms like JPMorgan and American Express offering escalating perks and rewards for cardholders. Wells Fargo's long-standing emphasis on cross-selling multiple products produced exorbitant pressures on front-line employees and led to widespread fraud in the bank's branches. 

Bank of America Corporation, has a history of beating analysts’ earnings estimates. In the past four quarters, the company: 

  • Beat analyst EPS estimates by 3 cents ($.46 actuals vs. $.43 forecast) in FQ2’17;
  • Beat analyst EPS estimates by 2 cents ($.48 actuals vs. $.46 forecast) in FQ3’17;
  • Beat analyst EPS estimates by 3 cents ($.47 actuals vs. $.44 forecast) in FQ4’17;
  • Beat analyst EPS estimates by 4 cents ($.62 actuals vs. $.58 forecast) in FQ1’18.

For FQ2’18, EPS is expected to grow by 24% year-over-year to $.57, while revenue is expected to decline 3% year-over-year to $22.48 billion.  


Over the last month, Bank of America Corporation (BAC) returned -3.93%.

Bank of America Corporation (BAC) average analyst price target ($34.56) is 19.88% above its current price ($28.83).

For the latest price and information on Bank of America Corporation, please visit Finstead and search for "BAC price" or "BAC news".

Wells Fargo & Co (WFC) earnings preview: revenue decline to be seen

5:01 am ET, 11 Jul 2018

Wells Fargo & Company (WFC)  is expected to report earnings on July 13 before market open.  The report will be for the fiscal quarter ending June 2018. Shares are trading at $55.89, up 1.18%.

What are WFC earnings expectations?  What news will the market be watching out for?  

Wells Fargo is the top deposit gatherer in the United States. Its strategy rests on deep customer relationships, sound risk management, and operational excellence.  Wells Fargo consistently paid less for balance sheet funding than most of its competitors over the past decade, and has also generated more revenue per dollar of assets than most peers over time, because of a loyal base of longtime customers.

Unlike its major competitors, Wells is not a top player in the capital markets. Its business model is more akin to regional banks than to money center institutions. Wells Fargo generates less than half the investment banking fees of companies like JPMorgan Chase, Goldman Sachs, and Bank of America, and trading gains made up only a small percentage of noninterest income. 

Wells Fargo relies on the more stable revenue generated by its brokerage, advisory, and asset management businesses. It competes to a large extent with regional peers, and its scale advantages should grow in importance as technology and compliance spending increase fixed costs across the industry. Wells Fargo deserves a lower cost of capital--and higher multiple--than riskier peers.

Wells Fargo’s sales culture overheated in recent years. Rather than attempting to improve its customers’ financial lives, management chose to increase revenue at all costs, introducing poorly designed incentive programs for front-line employees. This decision led to widespread fraud and risked relationships and reputation built over decades. 

Customers did not abandon Wells Fargo amid scandals and new programs focused on deepening active relationships will actually generate more revenue--and less wasted employee time--than overly ambitious product sales goals.

Wells Fargo & Company has a mixed history of beating analysts’ earnings estimates.  In the past four quarters, the company: 

  • Beat analyst EPS estimates by 5 cents ($1.07 actuals vs. $1.02 forecast) in FQ2’17;
  • Delivered on the analyst EPS estimate ($1.04 actuals vs. $1.04 forecast) in FQ3’17;
  • Missed analyst EPS estimates by 7 cents ($.97 actuals vs. $1.04 forecast) in FQ4’17;
  • Beat analyst EPS estimates by 5 cents ($1.12 actuals vs. $1.07 forecast) in FQ1’18.

For FQ2’18, EPS is expected to grow by 5% year-over-year to $1.12, while revenue is expected to decline 3% year-over-year to $21.56 billion.  

Over the last month, Wells Fargo & Company (WFC) returned +0.56%.

Wells Fargo & Company (WFC) average analyst price target ($61.44) is 9.93% above its current price ($55.89).

For the latest price and information on Wells Fargo & Company, please visit Finstead and search for "WFC price" or "WFC news".

JPMorgan Chase (JPM) earnings preview: will it beat the Street?

9:14 am ET, 09 Jul 2018

J P Morgan Chase & Co (JPM) is expected to report earnings on July 13 before market open.  The report will be for the fiscal quarter ending June 2018.  The shares are trading at 103.72, up 0.11% from yesterday.

What are the JPM earnings expectations?  What news will the market be watching out for?  

JPMorgan Chase’s combination of scale, diversification, and sound risk management seems like a simple path to competitive advantage, but few other firms have been able to execute a similar strategy.  JPMorgan now benefits from a nearly unrivaled combination of scale and scope within the United States, creating unique opportunities including its partnerships with other leading firms like Visa and Amazon.

JPMorgan has become the largest bank in the country, with about $1.4 trillion in deposits. Around $400 billion of these funds bear no interest costs whatsoever. Within payments, JPMorgan is the largest issuer of credit cards in the U.S. and the second-largest acquirer. The company’s investment bank is the leading global generator of fees, and the company’s fixed-income, commodities, and currency trading operations are the largest in the world.

As a systemically important firm, JPMorgan is likely to remain under the regulatory microscope for years to come. Regulatory relief will help smaller banks at the expense of "too big to fail" institutions.

JPMorgan Chase & Co. has a mixed history of beating analysts’ earnings estimates.  In the past four quarters, the company: 

  • Beat analyst EPS estimates by 14 cents ($1.71 actuals vs. $1.57 forecast) in FQ2’17;
  • Beat analyst EPS estimates by 9 cents ($1.76 actuals vs. $1.67 forecast) in FQ3’17;
  • Beat analyst EPS estimates by 7 cents ($1.76 actuals vs. $1.69 forecast) in FQ4’17;
  • Missed analyst EPS estimates by 2 cents ($2.26 actuals vs. $2.28 forecast) in FQ1’18;

For FQ2’18, EPS is expected to grow by 31% year-over-year to $2.24, while revenue is expected to grow 5% year-over-year to $27.66 billion.  


Over the last month, J P Morgan Chase & Co (JPM) returned -3.82%.

J P Morgan Chase & Co (JPM) average analyst price target ($120.91) is 16.57% above its current price ($103.72).

For the latest price and information on J P Morgan Chase & Co, please visit Finstead and search for "JPM price" or "JPM news".

Citigroup (C): Will The Stock Rebound?

12:02 am ET, 09 Apr 2018

Citigroup's stock (NYSE: C) price saw a 7.34% decline this year.

Citi is a leading global bank with about 200 million customers and is present in more than 160 countries of the world. Its brand is outstanding, but many investors are wondering, what is the stock price forecast now? 

Since the company's price-to-book value is around 1, investors barely account for its intrinsic value in the stock price. The elevated CBOE Volatility Index further increases Citi’s profitability.

In fundamental terms, Citigroup has a healthy stock, as demonstrated by its balance sheet. Since the banking regulation is becoming a little less constraining these days and the interest rates are going up, banks are becoming increasingly more profitable.

Can this stock rise further? Per Finstead Research, Citigroup has an average price target of almost $84. It has a significant upside compared to the current price. 

Citigroup has the lowest valuation among its peers.

JPMorgan Chase (JPM): What Does The Future Look Like?

6:45 pm ET, 05 Apr 2018

 JPMorgan Chase’s (NASDAQ: JPM) stock price barely increased in today’s trading

Jamie Dimon, the company's CEO, praised President Trump because of his tax cuts and deregulation while criticizing his trade and immigration policies beacause they will likely hurt growth in the United States.

According to Dimon, it is possible for the bank to grow and penetrate into new markets by investing excess capital stemming from the new federal tax cuts and constructive regulatory environment since the 2016 presidential elections.

According to Dimon, JPMorgan can earn a 17% return on the tangible equity that exceeds the target before the enactment of corporate tax cuts. It is also above the company’s 2017 performance by almost 4%.

CEO Dimon pointed out to Wall Street's low-profit estimates and declared that he would concentrate on buybacks to return capital to JPM's shareholders. This is indeed good news for the shareholders.

Dimon holds an opinion that buying back a big block of share would enhance the earnings per share by 2%-3% in the upcoming 5 years, with the tangible book value remaining virtually constant. Currently, the company has 1.6 times tangible book ratio which is below Dimon's threshold.

Per Finstead Research, JP Morgan has the average price target of $119. The stock price has an upside of about 9%.

JPMorgan's valuation is considered to be not overly conservative or aggressive. Based on the forward P/E ratio, JPMorgan is ahead of CMSGS, and  BAC, but behind WFC.  

5 Key Things You Should Understand About The Banking Sector

4:44 pm ET, 22 Jan 2018

If you're pondering investments in the banking sector, there are some key themes for 2018 you should understand that may shape your thinking about investing in large banks such as JP Morgan Chase, Citi, Wells FargoBank of America, or even smaller, regional ones.

The growth of the banking sector has been decreasing over the last 12 months. High interest rates involved have made large corporations to opt for borrowing and debt issuance at the prime rate on credit facilities. 

Here are the five things to know about the banking sector in 2018.

1. Credit Card Lending: In terms of loan development, credit card lending remains a major focus with solid gains and high consumer confidence in employment. Over the years, consumer finance companies and banks have been leading in rewarding credit card programs that attract new customers. Loan growth for most banks remains between single-digit low and medium range in 2018. 

2. The Increase of Net Charge-offs: While credit card lending may affect future margins, the net charge-offs may rise gradually with the maturing of the credit cycle though it can still remain below the historical standards. 

3. Flattening of the Productivity Curve: This is due to the long maturities that have not complied with the short-term rate rise. There are still high expectations of Fed hikes in 2018 with higher productivity continuing to slow down. 

4. Expansion of Interest Margin: This will occur even if the flatter yield curve does not offer similar lending business benefit as the initial rate increases of Fed. 

5. Favorable Regulatory Environment: This is a result of the new stance on deregulation of the new administration despite the stalling of the wider legislative efforts. With this, the earnings from the financial sector will remain favorable in relation to the broader market.

Though there have been variations in the banking sector, the requirements for reduced capital could create room for more lending. This is expected to significantly benefit most financial institutions in 2018. 

Over the last year, JPM returned +36.25%. This return is higher than the Money Center Banks industry (22.22%), the Financial sector (11.89%), and S&P 500 (24.73%) returns.

Over the last year, Citi returned +39.58%.  See below.

Over the last year, BAC returned +40.59%.   Details below.

WFC returned only +17.54%.  While this return is higher than the Financial sector return (11.89%), it is lower than the Money Center Banks industry (22.22%) and S&P 500 (24.73%) returns.

J P Morgan Chase & Co (JPM) Stock Guide

Updated at: 2:40 am ET, 18 Sep 2020

Before we start: if you're looking for JPM stock price, you can quickly find it out by visiting Finny and typing "JPM quote". If you're looking for a quick scoop on JPM stock (chart, price target, market cap, news and buy or sell analysis), go to Finny and look for "JPM". You'll get all this info in one place. Or you can just type "JPM news" to get the latest stock news.

Looking to buy or sell J P Morgan Chase & Co (JPM)? Interested in getting the full scoop on JPM, including earnings and dividends, stock forecast, buy or sell analysis and key stats? If so, you came to the right place.

In this JPM stock guide, we'll address key questions about JPM, above and beyond what you can find on Yahoo Finance, Zacks, MarketWatch or Morningstar.

Here is what you'll be able to find in this guide:

Earnings and Dividends: earnings, earnings date, dividend rate and dividend yield;
Analyst Predictions: stock forecast and analyst ratings;
Analysis: Finny Score and buy or sell analysis;
Key Stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio, industry, sector, and number of employees.

And here is the list of questions we'll answer:
1. What are JPM earnings?
2. What is JPM dividend?
3. What is JPM dividend yield?
4. What is JPM stock forecast (i.e., prediction)?
5. JPM buy or sell? What is JPM Finny Score?
6. What are the reasons to buy JPM? Why should I buy JPM stock?
7. What are the reasons to sell JPM? Why should I sell JPM stock?
8. What are JPM key stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

So let's start. Scroll down to the question that interests you the most.

Earnings and Dividends

1. What are JPM earnings?

JPM trailing 12-month earnings per share (EPS) is $7.47.

2. What is JPM dividend?

JPM forward dividend is $3.60.

3. What is JPM dividend yield?

JPM forward dividend yield is 3.59%.

Analyst Predictions

4. What is JPM stock forecast (i.e., prediction)?

Based on JPM analyst price targets, JPM stock forecast is $115.44 (for a year from now). That means the average analyst price target for JPM stock is $115.44. The prediction is based on 28 analyst estimates.

The low price target for JPM is $80.00, while the high price target is $144.00.

JPM analyst rating is Hold.

Analysis

5. JPM buy or sell? What is JPM Finny Score?

#{finnyScore:43}Our quantitative analysis shows 3 reasons to buy and 4 reasons to sell JPM, resulting in Finny Score of 43.

6. What are the reasons to buy JPM? Why should I buy JPM stock?

Here are the reasons to buy JPM stock:

  • JPMorgan has achieved a reasonable level of profitability despite a number of headwinds. Earnings could improve substantially once the firm is firing on all cylinders, especially in an environment of higher interest rates.
  • JPMorgan did a remarkable job of limiting its credit losses during the financial crisis.
  • Scale is becoming more important as regulatory and technological costs rise, improving JPMorgan Chase's competitive position.
  • Over the past several years, JPMorgan’s net interest income (NII) and net interest margin (NIM) had been under pressure amid a low interest rate environment. However, with the improvement in the interest rates scenario following the interest rate hikes and steady loan growth, strain on NII and NIM continue to ease. Over the last three years (2015-2017), NII has witnessed a CAGR of 7.3%.
  • Additionally, in order to overcome the challenging industry backdrop and comply with regulations, JPMorgan has been streamlining its businesses and focusing on core operations. The company continues to consolidate its branch network with an increased focus on digitization and by trimming workforce in its less profitable businesses. All these resulted in cost savings.
  • Further, JPMorgan remains focused on acquiring the industry's best deposit franchise and enhancing its loan portfolio. Despite the overall challenging market environment, total deposits and loan balances continued to grow over the past several years. As of December 31, 2017, loans-to-deposits ratio was 64%. Loan and deposit growth is expected to continue in the quarters ahead.
  • We remain encouraged by JPMorgan’s capital deployment activities. The company’s 2017 capital plan (approved by the Federal Reserve) includes a 12% dividend hike and $19.4 billion share repurchase authorization. Given its solid liquidity position and earnings strength, the company should be able to sustain improved capital deployments.
  • JPM forward dividend yield is 3.59%, higher than the industry (1.38%) and sector (1.11%) forward dividend yields. See JPM forward dividend chart.
  • JPM average analyst price target ($115.44) is above its current price ($98.56). See JPM price target chart.
  • JPM cash to debt ratio is 1.81, higher than the average industry (0.16) and sector (0.18) cash to debt ratio. See JPM cash to debt chart.

7. What are the reasons to sell JPM? Why should I sell JPM stock?

Let's look at the reasons to sell JPM stock (i.e., the bear case):

  • As a systemically important firm, JPMorgan is likely to remain under the regulatory microscope for years to come. Regulatory relief will help smaller banks at the expense of "too big to fail" institutions.
  • It's difficult to quantify potential exposures (let alone losses) created by the firm's trading activities, as evidenced by the London Whale incident.
  • Future CEOs may not be as talented as Jamie Dimon, who is one of few managers to achieve any measure of success at the helm of a systemically important institution.
  • JPMorgan’s non-interest income is expected to remain subdued in the upcoming quarters primarily due to the global equity market turmoil and other macro-economic factors. Notably, the same has been steadily declining at a four-year CAGR (2014- 2017) of 1.3%. Dismal performance of capital markets and slowdown in mortgage banking continue to put pressure on fee income.
  • Though JPMorgan has resolved quite a many litigation issues, it still faces investigations from several federal agencies and a few foreign governments for its business conducts in the pre-crisis period. Legal expenses are expected to continue weighing marginally on the company’s bottom line in the near future.
  • JPMorgan’s trailing 12-month return on equity (ROE) undercuts its growth potential. Also, the company’s ROE of 11.63% gradually deteriorated over last few years. In addition, it compares unfavorably with ROE of 16.01% for the S&P 500, reflecting the fact that it is less efficient in using shareholders’ funds.
  • JPM quarterly revenue growth was -18.40%, lower than the industry and sector average revenue growth (1.44% and 1.27%, respectively). See JPM revenue growth chart.
  • JPM profitability is declining. The YoY profit margin change was -1.08 percentage points. See JPM profitability chart.
  • JPM Price/Book ratio is 1.30, which is high compared to its industry peers’ P/B ratios. See JPM forward Price/Book ratio chart.
  • JPM Price/Sales ratio is 3.14, which is high compared to its industry peers’ P/S ratios. See JPM forward Price/Sales ratio chart.

Key Stats

8. What are JPM key stats : revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

Let's look at the key statistics for JPM:

Metrics JPM
Price $93.48
Average Price Target / Upside $115.44 / 23.49%
Average Analyst Rating Hold
Forward Dividend Yield 3.59%
Industry Banks - Global
Sector Financial Services
Number of Employees 256,105
Market Cap $305.19B
Forward P/E Ratio 11.35
Price/Book Ratio 3.14
Revenue (TTM) $97.28B
YoY Quarterly Revenue Growth -18.40%
Profit Margin 25.86%

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