JPMorgan, Bank of America, Citi Shares: Playing Offense and Defense Post Earnings

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Citigroup Inc Nyheter

Bank Of America Corp,Intel Corporation,Cisco Systems Inc

Stocks Analysis by Brian Gilmartin covering: Citigroup Inc, Bank of America Corp, Intel Corporation, Cisco Systems Inc. Read Brian Gilmartin's latest article on Investing.com

This will be a quick summary of the big bank earnings, which include JPMorgan Chase & Co and better credit metrics drove 29% y-o-y revenue growth and 36% EPS growth. JPM’s Corporate and Investment Bank which is 39% of total JPM net revenue and 44% of total segment net income as of Q3 ’24 saw revenue and net income grow 45% and 84% y-o-y respectively. ROTCE was a peer-leading 19%.

6 quarters ago, back in mid-2023, sell-side consensus estimates for full-year calendar 21024 expected JPM to see -7% EPS growth on -2% revenue growth. Today, calendar 2024 full-year consensus is expecting +9% revenue growth and +19% EPS growth, respectively. The stock is trading at 11x – 12x expected ’24 EPS but the EPS estimates start to get taken down for 2025. On book value and tangible book value valuations, JPM looks very overpriced compared to BAC and C, but JPM’s ROTCE is way ahead of both banks returns on equity too.

Was this why Mr. Buffett sold a considerable portion of his position in BAC ? It’s hard to say. If the asset-liability mismatch doesn’t change, the compressed NIM which was a headwind, now becomes a tailwind.

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