Jamie Dimon Likes JPMorgan at Current Levels – and Investors Pounce
Asked at a financial services conference on Tuesday morning about JPMorgan Chase’s (JPM) valuation, CEO Jamie Dimon answered that it was “very valuable” at its current price. That was all investors needed to hear, as shares in the nation’s largest bank rocketed up by as much as 9% during Tuesday’s trading, closing up 7% for the day at $95.82.
Dimon’s words carry weight among investors, as he famously bought $26 million in JPMorgan shares in February 2016 – a much-publicized and prescient move at what later proved to be a market trough.
“I’m not trying to predict the bottom,” Dimon said yesterday, adding that “you cannot be a bank and be immune to what goes on in the world out there.” JPMorgan has previously said that its 2020 earnings will be impaired, as it expects significant loan defaults throughout the year.
Dimon remarked that he is hopeful that the rest of the year will see improving fundamentals. “I give it some pretty good odds,” Dimon said. “The government has been very responsive, the Federal Reserve has been very responsive. Large companies have a huge wherewithal, hopefully we’ll keep the small ones alive long enough that most of them get back into business.”
Dimon added that the Federal Reserve’s actions to prop up financial markets were like “water that fills every crevice.”
Recent analyst reports have been bullish on JPMorgan. In one released last week, Susan Roth Katzke from Credit Suisse maintained a Buy rating on JPMorgan Chase & Co., with a price target of $122, even as she noted that low interest rates and an expected increase in credit losses will weigh on JPMorgan’s earnings this year and next.
Overall, the Moderate Buy analyst consensus and 12-month analyst price target of $110 represents 15% upside from JPMorgan’s current level. (See JPMorgan Chase & Co. stock analysis on TipRanks).
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