Find out more about JPMorgan Chase & Co. (JPM) stock ratings for Growth, Momentum, and Quality and decide if this bank stock is right for you.
Investing in JPMorgan Chase & Co. stock
JPMorgan Chase & Co., a financial holding firm, is one example. The Company’s activities include asset management, investment banking, and financial services. It has four segments and a Corporate segment. Its segments include Consumer & Community Banking and Corporate & Investment Bank. Consumer & Community Banking offers services to businesses and consumers through bank branches, automated teller machines, online and mobile banking, as well as telephone banking. The Corporate & Investment Bank segment includes Banking and Markets and Investor Services. It offers services such as market-making, prime brokerage and treasury and securities products and solutions to investors, corporations, financial institutions, government and municipal entities. The Commercial Banking segment offers financial solutions including investment banking, lending, treasury and asset management. The Asset Management segment includes wealth and investment management.
Continue reading to find out how JPMorgan Chase & Co. rates on key metrics and whether or not it meets your investment requirements.
Latest JPMorgan Chase & Co. (JPM) Stock News
JPMorgan Chase & Co. has a market capitalization of $513.3 billion as of October 25, 2021. This is compared to the Banks median value of $408.9million. JPMorgan Chase & Co. stock is up 34.9% for 2021, 1.7% in five trading days, and 68.9% for the past year. JPMorgan Chase & Co. currently has a price-earnings ratio of 10.8. JPMorgan Chase & Co. has a trailing 12-month revenue of $57.4 Billion with a 67.7% profit margin. The most recent quarter’s year-over-year sales growth was -12.5%. For the current fiscal year, analysts expect adjusted earnings of $14.960 per share. JPMorgan Chase & Co. has a 2.3% dividend rate.
Diversified banks’ outlook is positive, as credit risk and commercial loan activity improves over 2021 and 2022. The best-established banks survived the worst of the COVID-19 pandemic, and they are expected to recover. This is evident in loan loss reverses that could have a positive effect on future earnings. Banks will see lower net interest income (NII) as the Federal Reserve plans on keeping rates close to zero through 2022. These banks’ NII accounts account for between 50-60% of their revenue. These lower rates may be partially offset by the wider spread between loan volume and cost of borrowing. Banks are now facing less uncertainty, which will help them to be more profitable, take advantage of upcoming NII trends and generate non-NII fees income. Low rates are a major driver of consumer loan growth. Mortgage origination and auto loans are key drivers. In the second quarter 2021, commercial loans will grow by approximately 1-3%. Credit card activity is another driver. It has seen a rise in recent months due to the removal of COVID-19 travel restrictions. The Fed’s Dodd Frank Stress Test results DFAST have shown that capital returns are increasing in the second half 2021. All 23 large banks were able to maintain their capital requirements, as well as other restrictions, that were imposed during Covid-19. All large banks are subjected to the usual restrictions of theFed’s stress capital buffer SCB framework which sets the return on capital guidelines. We have seen significant increases in dividends as well as share repurchases at the largest banks like JPMorgan Chase and JPM.
Grading JPMorgan Chase & Co. Stock
Stock evaluation requires accessing large amounts of data, the knowledge and time required to sort through them all. A+ Investor is a data suite that helps investors tackle this daunting task. It condenses data research in an easy-to-use and customizable manner that’s suitable for all levels of knowledge.
Our proprietary stock grades are available with A+ Investor. These grades provide intuitive A-F grades that correspond to five important investing factors: quality, value, momentum, earnings revisions, and growth. We’ll be taking a closer look at JPMorgan Chase & Co. stock grades for quality, growth, and value.
JPMorgan Chase & Co. Growth Grade
The idea of growth investing is based on the belief that stocks of companies with strong, consistent, and long-term growth will outperform those of slower growing companies. We measure several aspects of growth, including annual sales and earnings increases, long-term historical sales growth rates, and analyst-forecasted long term earnings growth.
These components evaluate a company’s ability to grow its sales, earnings per shares and operating cash year over year for the most recent reported fiscal quarter. They also consider the cumulative effect of the past five years. Higher rates are better than the sector median and lead to higher scores.
JPMorgan Chase & Co. has a growth score of 39. This is Weak.
JPMorgan Chase & Co. Quality Grade
As the value grade
The A+ Investor quality score is based on the percentile rank for key metrics. The quality score is the percentile rank of all the key metrics, including the return on assets (ROA), the return on invested capital(ROIC), gross profits relative to assets and buyback yield. It also includes accruals, Z prime bankruptcy risk (Z), F-Score, and accruals.
Variable scores can be used to consider any eight measures. However, if any one of these measures is invalid, it will still take into account the other valid measures. Stocks must have at least one valid measure (non-null), and the corresponding ranking for at most four of eight quality measures in order to be given a quality score.
To assess the “quality” of a stock, the quality score is used. Stocks with a higher quality score have greater upside potential and lower downside risk. Over the period 1998 to 2019, backtesting has shown that stocks with higher quality stocks outperformed those with lower grades.
Stocks are given better grades (higher score) for higher quality sub-components scores. However, stocks get lower grades (lower score) for lower sub-component scores.
JPMorgan Chase & Co. has a 36 Quality Score, which is Weak.
JPMorgan Chase & Co. Momentum Grade
Stocks with unusually high rates of return are identified by their momentum grades. Research shows that stocks with high relative momentum levels tend to outperform others, while stocks with lower momentum levels tend to continue to underperform. Momentum measures the stock’s price change over a specific period of time relative to all other stocks.
We typically look at the weighted relative strengths over the preceding four quarters. The relative price change over the four previous quarters is what makes up the weighted relative strength rank. The weighting given to the most recent quarterly price change is 40%, and each quarter prior is 20%.
JPMorgan Chase & Co. has a Momentum score of 68 which is strong.
Other JPMorgan Chase & Co. Grades
A+ Investor provides not only Growth, Momentum, and Quality but also grades for Value Revisions and Estimate Revisions.
The company’s last two fiscal quarter earnings surprises are taken into consideration when calculating the revision score for its earnings estimate. Surprises often lead to more surprises or even continued sales growth. However, the opposite is also true. The stock screen that tracks the most revisions to earnings (i.e. the best grades) has a 23.1% annual backtested return since inception. A screen that tracks the lowest revisions has a return on investment of less than 5%.
Stock investing is about buying low and selling high. Stock valuation is an important factor in stock selection. Stocks that are expected to rise are usually bought at a lower price, even though momentum investors might argue otherwise.
PMorgan Chase & Co. Stock: Bottom Line
JPMorgan Chase & Co. stock overall has a Growth grade of D, Momentum grade of B, and Quality grade of D.
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