Buckingham Research Group’s James Mitchell maintains a Buy rating on JPMorgan’s stock with an unchanged $135 price target.
JPMorgan’s earnings report confirms the company’s status as a “best-in-class global franchise with above organic growth and returns” remains unchanged, Mitchell said in a note.
Here are some of the analyst’s major takeaways from the earnings report:
- JPMorgan’s results excluded a $2.4 billion net impact from tax reform (69 cents per share decrease in EPS).
- Normalizing the results for a few one-time items, revenue came in $300 million ahead of forecast.
- The overall beat was driven by strength in consumer, commercial banking, and net interest income (NII).
- Management’s guidance of flat to slightly down NIM is “actually quite positive” when including two fewer days in the first quarter and the FTE impact from the tax cut.
- Management’s guidance of nearly flat NII sequentially implies a “significant benefit” from recent rate hikes
- Management’s guidance of a 19 percent take rate in 2018 is below the analyst’s estimate of 23 percent.
- The one “wild card” from the report and guidance is the degree to which management will accelerate investment spending.
Shares of JPMorgan were trading higher by 0.9 percent at $111.75.