To The Moon

$JPMorgan Chase(JPM)$

This morning, JP Morgan Chase (NYSE: JPM) reported its latest quarterly results before the opening bell. Shares dipped modestly, closing down about 0.74% after a volatile session, but nothing alarming for the world’s largest bank by market capitalization. Investors and analysts alike were keen to parse the numbers—not just for what they say about the bank itself, but also for what they reveal about U.S. consumers, corporate spending, and the broader economy.

JP Morgan’s earnings once again beat expectations—marking what may be its 11th or 12th consecutive beat on both revenue and earnings per share. Here’s a closer look at the highlights of the quarter, what they tell us about the state of the economy, and whether the stock remains an attractive buy.

Another Strong Quarter: Headline Results

JP Morgan reported revenue of approximately $45.7 billion for the quarter, with earnings per share coming in just shy of $5. Both figures comfortably exceeded Wall Street forecasts, continuing the bank’s long streak of quarterly beats. Revenues grew 2.6% over the trailing 12 months, while EPS rose by around 12%.

Valuation-wise, the stock trades at about 4.5x sales and roughly 15x earnings—arguably a premium relative to peers, but not unreasonable given its scale and profitability.

Financial Highlights: Growth and Efficiency

Digging into the details, firmwide revenue totaled $44.9 billion against expenses of $23 billion, resulting in an overhead ratio of 53%. Credit losses were $2.8 billion, with net charge-offs of $2.4 billion—a testament to the bank’s prudent risk management.

On the lending and deposits side, average loans increased 5% year-over-year and 3% sequentially, while average deposits rose 6% compared to last year.

Consumer Banking Paints a Resilient Picture

Within the Consumer & Community Banking (CCB) segment, average deposits fell slightly by 1% year-over-year, but client investment assets jumped 14%. Average loans in this segment were flat compared to the prior quarter, and card charge-offs came in at a low 3.4%, improving from the prior quarter—a positive signal about the health of consumers.

Card sales volumes climbed 7% year-over-year, and active mobile customers increased 8%, showing robust consumer engagement. In short, the data depict steady consumer spending, no alarming rise in delinquencies, and healthy financial behavior overall.

Corporate and Asset Management Businesses Thrive

JP Morgan’s corporate and investment banking division also showed strength. Investment banking fees were up 7% year-over-year, rising 12% sequentially. Markets revenue increased 15% over the same period.

In Asset & Wealth Management, assets under management (AUM) reached an impressive $4.3 trillion, up 18% year-over-year. Average loans in this segment climbed 7%, further reinforcing the story of disciplined growth across business lines.

Shareholder Returns: Dividends and Buybacks

The bank maintained its quarterly dividend at $1.40 per share, representing a 20% increase over the trailing 12 months—a reflection of confidence in its capital position and cash generation.

In addition to dividends, JP Morgan repurchased $7.1 billion worth of stock during the quarter. These capital returns are facilitated in part by deregulation efforts that have loosened some capital restrictions on banks. In sum, JP Morgan continues to generate substantial free cash flow and return it to shareholders while investing in growth.

Addressing Some Concerns: Income and Valuation

It’s worth noting that net income fell year-over-year from $18.1 billion to $14.9 billion, though this was expected given certain accounting factors in the prior year’s quarter. Return on equity remained solid at 18%, and return on tangible common equity stayed strong at 21%—both industry-leading figures.

The stock’s premium valuation relative to other banks reflects its superior scale, efficiency, and reputation as arguably the best-run major U.S. bank.

Guidance and Outlook

Looking ahead, management guided to net interest income of roughly $95 billion for the full year, which would represent about 7% growth year-over-year. Jamie Dimon noted that continued growth in asset management, operating leverage, and corporate activity could lift earnings by as much as 10% in upcoming quarters.

Net charge-off rates are expected to remain low at around 3.6%, suggesting management does not foresee significant deterioration in credit quality.

Fair Value and Investment Thesis

Bank stocks are complex to value, but applying an excess returns model with conservative assumptions produces an estimated fair value for JP Morgan stock of around $369 per share. At its current trading price of approximately $286, the stock appears to be undervalued by about 22%.

While its P/E ratio may appear elevated compared to peers, the bank’s unmatched economies of scale and unit economics justify a premium.

Is JP Morgan Still a Buy?

Given its strong balance sheet, steady consumer and corporate trends, shareholder-friendly capital returns, and a modest valuation relative to intrinsic value, JP Morgan remains a buy in my view.

The stock is in a clear long-term uptrend, consistently making higher highs and higher lows, even through periods of market volatility. Should the stock experience a short-term pullback to the $260–$270 range, it could present an even more compelling entry point. For long-term investors with a horizon of five years or more, the current level remains attractive.

Conclusion: Business as Usual at America’s Premier Bank

JP Morgan delivered yet another solid quarter, underpinned by disciplined lending, resilient consumer behavior, growth in wealth management, and robust corporate activity. Despite a modest year-over-year decline in net income, the bank remains on track to grow earnings meaningfully in the coming quarters.

With continued deregulation, strong demand for financial services, and ongoing M&A and IPO activity, JP Morgan is well-positioned to benefit from macro and micro tailwinds alike.

For patient investors, JP Morgan represents a rare combination of stability, growth, and shareholder returns. Its premium valuation is justified by its performance and leadership in the industry.

Key Takeaways:

• Earnings and revenue again beat expectations, continuing a long streak.

• Consumer spending remains steady, with no major stress signals.

• Corporate and investment banking businesses are growing, with record AUM.

• Dividend hikes and aggressive buybacks enhance shareholder value.

• The stock appears undervalued by ~22% compared to its intrinsic worth.

Verdict: JP Morgan remains a BUY for long-term investors looking for a blue-chip financial stock with a solid growth trajectory and strong capital returns.

Disclaimer: I want to make it clear that I am not a financial advisor, and nothing I say is intended to be a recommendation to buy or sell any financial instrument. Additionally, it's important to remember that there are no guarantees or certainties in trading or investing, and you should never invest money that you can't afford to lose.

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