Yahoo Finance Here Are 5 Reasons to Invest in JPMorgan (JPM) Stock Now
JPMorgan Chase & Co. JPM looks like a solid investment option despite the industry-wide turmoil. The company remains on track for organic growth with the help of a rise in loan and deposit balances. Further, it's substantial capital deployment activities are likely to enhance shareholder value.
The Zacks Consensus Estimate for JPMorgan's 2023 earnings has been revised marginally upward over the past seven days. This shows that analysts are optimistic regarding the company’s earnings growth prospects. Thus, JPM currently carries a Zacks Rank #2 (Buy).
Over the past year, shares of the company have gained 11.8% against the industry's decline of 11.7%.
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Mentioned below are a few factors that make JPM stock worth betting on right now:
Earnings Growth: JPMorgan witnessed earnings growth of 12.2% in the past three to five years, which is higher than the industry average of 6.8%. The uptrend is expected to continue in the near term. For 2023, the company’s earnings are projected to grow 18.5%.
Also, its long-term (three-five years) expected earnings growth rate of 5% promises rewards for investors.
Revenue Strength: JPMorgan’s organic growth trajectory looks impressive. The company's total revenues (managed) witnessed a compound annual growth rate (CAGR) of 4.4% over the last five years (2018-2022). The sales estimates for 2023 have been revised 14.6% upward. Higher rates, global expansion efforts, steady loan demand and deposits will continue to support revenues for the quarters ahead.
Strategic Buyouts: JPM has been continuously expanding its operations in new regions by acquiring both domestic and international companies. In May, the company acquired Aumni and failed First Republic Bank. Last year, it announced a deal to buy Renovite, while it acquired a 49% stake in Greece-based Viva Wallet and Global Shares.
Likewise, in 2021, the company announced several other acquisitions. The notable ones are a 75% stake in Volkswagen's payment arm Volkswagen Financial Services. OpenInvest, a 40% stake in Brazil's C6 Bank, the U.K.-based robo-advisor Netmeg and 55ip. These, along with several other past deals, continue to support the company's financials, help diversify revenues and improve market share.
Steady Capital Deployments: JPMorgan’s capital deployment activities seem impressive. Following the clearance of the 2022 stress test, it kept the quarterly dividend unchanged at $1 per share. Amid macroeconomic woes, the company had temporarily suspended share repurchases to maintain higher future capital requirements. Notably, JPM resumed share buyback effective first-quarter 2023 as it reached the CET1 ratio target of 13% earlier than expected.
The company has plans to repurchase shares worth $12 billion in 2023. Driven by earnings strength and strong capital position, JPM is expected to sustain its current capital deployments.
Superior Return on Equity (ROE): JPMorgan has an ROE of 16.02%, higher than the industry average of 12.37%. This shows that the company reinvests its cash more efficiently than its peers.
Other Banks Worth a Look
A few other top-ranked bank stocks are The Bancorp TBBK and Pathward Financial, Inc. CASH. While TBBK currently sports a Zacks Rank #1 (Strong Buy), Pathward Financial carries a Zacks Rank of 2. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for The Bancorp’s current-year earnings has been revised 6.5% upward over the past 60 days. TBBK’s shares have risen 54.7% in the past year.
Earnings estimates for CASH have moved 1.8% upward for 2023 over the past 30 days. Over the past year, Pathward Financial’s shares have rallied 18.6%.
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JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report
The Bancorp, Inc. (TBBK) : Free Stock Analysis Report
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