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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: 9:45 pm ET, 12 Jan 2021

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. When is JPM earnings date?
3. What is JPM dividend?
4. What is JPM dividend yield?
5. What is JPM stock forecast (i.e., prediction)?
6. JPM buy or sell? What is JPM Finny Score?
7. What are the reasons to buy JPM? Why should I buy JPM stock?
8. What are the reasons to sell JPM? Why should I sell JPM stock?
9. 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 $7.67.

2. When is JPM earnings date?

JPM earnings date is January 15, 2021.

3. What is JPM dividend?

JPM forward dividend is $3.60.

4. What is JPM dividend yield?

JPM forward dividend yield is 2.83%.

Analyst Predictions

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

Based on JPM analyst price targets, JPM stock forecast is $131.18 (for a year from now). That means the average analyst price target for JPM stock is $131.18. The prediction is based on 28 analyst estimates.

The low price target for JPM is $80.00, while the high price target is $164.00.

JPM analyst rating is Hold.


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

#{finnyScore:38}Our quantitative analysis shows 3 reasons to buy and 5 reasons to sell JPM, resulting in Finny Score of 38.

7. 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 quarterly revenue growth was 2.70%, higher than the industry and sector average revenue growth (0.08% and 1.02%, respectively). See JPM revenue growth chart.
  • JPM forward dividend yield is 2.83%, higher than the industry (1.04%) and sector (0.96%) forward dividend yields. See JPM forward dividend chart.
  • JPM cash to debt ratio is 1.99, higher than the average industry (0.16) and sector (0.18) cash to debt ratio. See JPM cash to debt chart.

8. 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 stock price ($141.28) is at the 52-week high. Perhaps now is a good time to sell? See JPM price chart.
  • JPM profitability is declining. The YoY profit margin change was -1.08 percentage points. See JPM profitability chart.
  • JPM Price/Book ratio is 1.61, which is high compared to its industry peers’ P/B ratios. See JPM forward Price/Book ratio chart.
  • JPM Price/Sales ratio is 3.95, which is high compared to its industry peers’ P/S ratios. See JPM forward Price/Sales ratio chart.
  • JPM average analyst price target ($131.18) is below its current price ($141.28). See JPM price target chart.

Key Stats

9. 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 $138.88
Average Price Target / Upside $131.18 / -5.54%
Average Analyst Rating Hold
Forward Dividend Yield 2.55%
Industry Banks - Global
Sector Financial Services
Number of Employees 256,105
Market Cap $430.31B
Forward P/E Ratio 14.69
Price/Book Ratio 4.39
Revenue (TTM) $98.03B
YoY Quarterly Revenue Growth 2.70%
Profit Margin 26.03%

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