JPMorgan Chase reported stronger-than-expected 4Q results on Friday, reflecting strong growth in its deposit base, improvement in loans, and higher investment banking fees.
JPMorgan’s (JPM) 4Q net revenues increased 3.2% to $29.2 billion year-on-year and topped Street estimates of $28.65 billion. Further, its adjusted earnings of $3.07 per share came in ahead of the consensus forecast of $2.62.
The bank’s average loans were up 1%, while its deposits surged 35% during the quarter. Moreover, revenues from the Corporate & Investment Bank segment grew 17% year-on-year, reflecting 37% growth in investment banking revenues and an 18% increase in Markets & Securities Services sales. (See JPM stock analysis on TipRanks).
Following the earnings release, RBC Capital analyst Gerard Cassidy raised the stock’s price target to $150 (8.2% upside potential) from $130 and reiterated a Buy rating.
In a note to investors, Cassidy said that JPMorgan’s impressive performance was “led by better-than-anticipated revenues and a significant loan loss provision benefit (negative loan loss provision).” He added, “Assuming the economy continues to expand throughout 2021, JPM should steadily rebuild its earnings power along with the strengthening in the economy.”
Overall, the rest of the Street is cautiously optimistic on the stock, with the Moderate Buy analyst consensus based on 10 Buys, 4 Holds, and 2 Sells. The average analyst price target of $145.86 implies upside potential of about 5.2% to current levels. Shares have gained about 1.4% over the past year.