JPMorgan Chase (NYSE: $JPM), the largest bank in the US, with a market cap of $496.762 billion, revealed it made record profits in the full year 2023. According to its report, the company made a record $49.6 billion profit during one of the most tumultuous years for the US banking sector since the 2008 financial crisis.
JPMorgan Chase Earnings Report
According to Jamie Dimon, the bank’s CEO, the company recorded $49.6 billion for the full year 2023, the most made by any US bank in history. Dimon added that they made a net income of $9.3 billion, or $12.1 billion, excluding the FDIC payments they made in the quarter. The CEO added that they had a total loss-absorbing capacity of $514 billion and $1.4 trillion in cash and marketable securities.
For Q423, They reported an EPS of $3.04, missing the analysts’ target of $3.60 by 15.65%. Their revenue for the quarter was $38.57 billion, missing the analysts’ target of $39.78 billion by 3.04%
Why Profits Fell In Q4
JPMorgan Chase reported a drop in profits for Q4. The drop was due to them having to set aside around $3 billion to rebuild the federal deposit insurance fund.
JPMorgan is amongst a handful of banks that have to pay most of the $16 billion needed to replenish the deposit insurance fund (DIF) of the Federal Deposit Insurance Corporation. It was depleted after Signature Bank and Silicon Valley Bank failed in 2023.
While CEO Dimon was upbeat about the US economy, predicting a soft landing, he was cautious. He noted that increased spending due to increased military spending, rising healthcare costs, and the cost of restructuring global supply chains could raise inflation and lending rates above market expectations.
JPM Stock Performance
JPM stock was up 0.65% during early morning trading on Friday, January 12, 2024, at $171.41 per share. In the past 12 months, the stock has been up 22.88%, and it has been up 15.70% in the past six months.
JPM Stock Forecast
Stock analysts give JPM stock a buy rating. They give the stock a high target of $243 and a low of $151. Their average target for the stock is $175.50, a 2.09% upside on the current price.
Should You Buy JPMorgan Chase Stock?
JPMorgan Chase has proven to be one of US history’s most resilient banking institutions. Despite the crisis of 2023 that almost brought US banking to its knees, JP Morgan Chase has managed to set record profits- the biggest ever recorded by any US bank.
Additionally, its profits account for nearly a fifth of all profits recorded by the US banking sector in 2023. As a business, JP Morgan has proven to be a haven for investors even during times of crisis. For investors who care about stability and long-term resilience, JPM stock is one of the best options. While it may not offer the biggest returns, it has proven capable of withstanding the most severe shocks. Consequently, the buy rating accurately reflects the bank’s business model and future performance.
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