J.P.Morgan Chase & Co. (JPM) is scheduled to report their results after the market closes on April 14, 2010. We are in the beginning stages of economic healing with powerful credit improvement coming in the banks. As credit costs fade, EPS for the large cap banks is expected to rise. JPM is one of the biggest beneficiaries, with an estimated $3.57 of EPS growth from 2009-2012 coming from lower credit costs. In 2010, JPM's earnings are expected to increase 17% year-on-year, and over the next three years to increase 130%, driven primarily by declining credit costs.
J.P. Morgan Chase & Co. is a leading global financial services
firm. The firm is a leader in investment banking, asset management,
private banking, private equity, custody and transaction services and
retail and middle market financial services. A component of the Dow
Jones Industrial Average, JPMorgan Chase is headquartered in New York
and serves more than 30 million consumer customers and the world's
most prominent corporate, institutional and government clients.
For the full year 2009, JPMorgan Chase & Co. reported net income of $11.7 billion, that's EPS of $2.26 on record revenues of $108.6 billion and record pre-tax pre-provision profits of $57 billion. In the fourth quarter, net income was $3.3 billion, with an EPS of $0.74 on revenue of about $25 billion. The Investment Banking fee line touched $1.9 billion in Q4 2009, which brought the company revenue to a record $7.1 billion for the full year. Fixed Income Markets revenues amounted to $2.7 billion in the quarter down from the record levels in the third quarter this year and Equity markets at about $1 billion of revenues, with Credit Portfolio seeing negative revenue of $669 million.
Analysts' estimates for Q1 2010 range from a low of $0.45 to a high of $0.81, compared to a consensus estimate of $0.65, with number of estimates being 21 and the co-efficient variance 14.99. JP Morgan Chase Capital XXIX on March 25, 2010 sold $1.5 billion of capital securities and is expected to receive a tax refund of close to $1.4 billion from its acquisition of Washington Mutual.
With the stock closing 1.07% up at $45.18 on April 1, 2010, JP Morgan Chase & Co. is relative Overweight given its early capital markets and card businesses and stronger risk management relative to peers and strong capital levels, accretion from the WM acquisition driving higher earnings growth going forward and a stronger balance sheet which will enable it to take share. The stock price is expected to reach as much as $54.
