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Category: Stock Market and JP Morgan Chase
Date: 15 October 2019 Stock Price: $116.45 We take a look at the 2nd quarter earnings report of their 2019 fiscal year of JP Morgan Chase on of the oldest financial institutions in the world and a market capital of almost $375 billion.
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About JP Morgan Chase
JPMorgan Chase (NYSE: JPM) is one of the oldest financial institutions in the United States. With a history dating back over 200 years, here's where we stand today:
- We are a leading global financial services firm with assets of $2.6 trillion.
- We have a presence in over 100 markets.
- We have over 250,000 employees.
- We serve millions of consumers, small businesses and many of the world's most prominent corporate, institutional and government clients.
- We are a leader in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing and asset management.
- Our stock is a component of the Dow Jones Industrial Average.
Overview of JP Morgan Chase's latest earnings report
Data below refers to quarterly data unless specified otherwise:
- Revenue: $28.8 billion (up from $27.753 billion for the same period of the previous year)
- Revenues increased by 3.77% over the last 12 months
- Total non interest expenses: $16.341 billion (up from $15.971 billion for the same period of the previous year)
- Operating costs and expenses increased by 2.31% over the last 12 months
- Net income: $9.652 billion (up from $8.316 billion for the same period of the previous year)
- Diluted earnings per share: $2.82 (up from $2.29 for the same period of the previous year)
- PE ratio of JP Morgan Chase: 10.2
- Dividend declared: $0.80
- Dividend yield: 2.06%
- Diluted weighted-average shares outstanding: 3.259 billion (down from 3.434 billion for the same period of the previous year)
- Book value per share: $73.88 (up from $68.85 for the same period of the previous year)
- Cash and cash equivalents: $23.164 billion
- Cash and cash equivalents per share: $7.10
- Cash and cash equivalents makes up 6.1% of JP Morgan Chase's market capital
- Cash and cash equivalents makes up 0.85% of JP Morgan Chase's total assets
- Loans net of allowances for losses: $943.723 billion
- Loans net of allowances for losses 34.6% of JP Morgan Chase's total assets
- Goodwill: $53.302 billion
- Goodwill makes up 1.95% of JP Morgan Chase's total assets
- Goodwill per stock: $16.35
- Stockholders equity in JP Morgan Chase: $263.215 billion
- Stockholders equity per share: $80.76
- So JP Morgan Chase is trading a 1.43 times its stockholders equity which is within the expected range of between 2 and 4 which most firms tend to trade at.
JP Morgan Chase's management commentary on the results
Jamie Dimon, Chairman and CEO, commented on the financial results: “We had a strong second quarter and first half of 2019, benefitting from our diversified global business model. We continue to see positive momentum with the U.S. consumer – healthy confidence levels, solid job creation and rising wages – which are reflected in our Consumer & Community Banking results. Double-digit growth in credit card sales and merchant processing volumes reflected healthy consumer spending and drove 8% growth in credit card loans, while mortgage and auto originations showed solid improvement, and we continued to attract new deposits, up 3%. Client investment assets were up 16%, driven by both physical and digital channels, including You Invest.” Dimon added: “In the Corporate & Investment Bank, Markets performance was relatively steady on slightly lower client volume, probably due to slightly higher global macroeconomic and geopolitical uncertainties. Treasury Services and Securities Services demonstrated good organic growth despite headwinds from rates. Although the global wallet was down, year-to-date the Firm ranked #1 in Global IB fees and gained share across products and regions, with particular strength from Commercial Banking, where gross IB revenue was up 8% for the first half of the year.
And in Asset & Wealth Management, AUM and client assets grew 7%, both due to higher asset values and net inflows into long-term and liquidity products.” Dimon concluded: “We were pleased to announce a meaningful increase to our dividend and repurchases. While we always prefer to invest capital back into the business, our capital plan provides us with the capacity and flexibility to return excess capital to our shareholders. We have opened new branches, announced strategic acquisitions like InstaMed, and invested in digital products to deepen our engagement with our customers, who have now opened over 2 million accounts digitally and activated over 60 million Chase Offers. We also continued our investments in local communities – for example, we expanded our long-term commitment to Detroit from $150 million to $200 million as we continue to learn how to drive inclusive growth in the communities around the world that need the most support.”
And in Asset & Wealth Management, AUM and client assets grew 7%, both due to higher asset values and net inflows into long-term and liquidity products.” Dimon concluded: “We were pleased to announce a meaningful increase to our dividend and repurchases. While we always prefer to invest capital back into the business, our capital plan provides us with the capacity and flexibility to return excess capital to our shareholders. We have opened new branches, announced strategic acquisitions like InstaMed, and invested in digital products to deepen our engagement with our customers, who have now opened over 2 million accounts digitally and activated over 60 million Chase Offers. We also continued our investments in local communities – for example, we expanded our long-term commitment to Detroit from $150 million to $200 million as we continue to learn how to drive inclusive growth in the communities around the world that need the most support.”
JP Morgan Chase (NYSE: JPM) stock price history
The image below, obtained from Google, shows the stock price history JP Morgan Chase over the last 5 years. And it's been a very good time for JP Morgan Chase stockholders. 5 years ago the stock was trading at around $56.20 a stock and its currently trading at $116.45 a stock. That's a impressive return of 107.20% returned to JP Morgan Chase stockholders over the last 5 years.
The stock of JP Morgan Chase is trading at a lot closer to its 52 week high of $120.40 than it is to its 52 week low which to us is an indication that the momentum and sentiment of JP Morgan Chase stock is very positive at the moment.
The stock of JP Morgan Chase is trading at a lot closer to its 52 week high of $120.40 than it is to its 52 week low which to us is an indication that the momentum and sentiment of JP Morgan Chase stock is very positive at the moment.
Recent coverage of JP Morgan Chase
The extract below discusses the latest regarding JP Morgan Chase as obtained from TheStreet.com
NEW YORK, Oct. 14, 2019 /PRNewswire/ -- J.P. Morgan Asset Management today announced enhancements to Target Date Compass ©, the target date fund (TDF) analysis tool used by advisors to help plan sponsors evaluate and select funds with greater knowledge and confidence. The enhanced Target Date Compass delivers new search capabilities that allow advisors to more quickly find the funds that align to plan sponsor goals, while new filters enable them to easily narrow down the target date universe. The upgraded tool is powered by third-party Morningstar data, delivering a digital-first, best-in-class experience. "Since Target Date Compass was launched in 2008, the program has been a standard bearer for target date fund evaluation. Over the past decade we have continued to work in consultation with our clients to evolve the tool. The latest iteration provides advisors with the capability to assess target date funds more quickly, easily and accurately," said Michael Miller, Head of Retirement Distribution at J.P. Morgan Asset Management. "These enhancements are another example of our business-wide efforts to offer advisors intuitive, digital-first experiences that enable to them to better serve their plan sponsor clients and grow their business.
NEW YORK, Oct. 14, 2019 /PRNewswire/ -- J.P. Morgan Asset Management today announced enhancements to Target Date Compass ©, the target date fund (TDF) analysis tool used by advisors to help plan sponsors evaluate and select funds with greater knowledge and confidence. The enhanced Target Date Compass delivers new search capabilities that allow advisors to more quickly find the funds that align to plan sponsor goals, while new filters enable them to easily narrow down the target date universe. The upgraded tool is powered by third-party Morningstar data, delivering a digital-first, best-in-class experience. "Since Target Date Compass was launched in 2008, the program has been a standard bearer for target date fund evaluation. Over the past decade we have continued to work in consultation with our clients to evolve the tool. The latest iteration provides advisors with the capability to assess target date funds more quickly, easily and accurately," said Michael Miller, Head of Retirement Distribution at J.P. Morgan Asset Management. "These enhancements are another example of our business-wide efforts to offer advisors intuitive, digital-first experiences that enable to them to better serve their plan sponsor clients and grow their business.
JP Morgan Chase (NYSE: JPM) latest stock valuation
So what is JP Morgan Chase stock worth based on the release of their latest earnings report? Based on JP Morgan Chase latest earnings report our valuation models provide a target (full value) price for JP Morgan Chase stock at $127.60 a stock. We therefore believe that the stock of JP Morgan Chase is undervalued.
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $127.60. Therefore we believe a good entry point into JP Morgan Chase's stock is at $114.90 or below. The release of JP Morgan Chase's 3rd quarter 2019 earnings report later today will set the tone for the stock's movement over the next few weeks.
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $127.60. Therefore we believe a good entry point into JP Morgan Chase's stock is at $114.90 or below. The release of JP Morgan Chase's 3rd quarter 2019 earnings report later today will set the tone for the stock's movement over the next few weeks.
Next earnings release date for JP Morgan Chase
It is expected that JP Morgan Chase (NYSE: JPM) 3rd quarter 2019 earnings report will be released later today, 15 October 2019.