Among the 22 stocks in the Banks-Money Center group,JPMorgan
) is No. 1 in earnings.
The global financial company's EPS Rating is 95, which puts it
in the top 5% of all the stocks in IBD's database.
About a week ago, the big-cap company reported results for the
fourth quarter and the full year.
Quarterly earnings jumped 54% on a year-ago basis. The Street
expected a 29% increase. Revenue missed but accelerated to 7%, up
from 3% in the previous quarter.
For the full year, earnings grew 16%, while revenue eased
The Street's consensus view estimates 2013 EPS growth at only
3%, but there are factors that could make that estimate low.
JPMorgan CEO Jamie Dimon has been an outspoken critic of the
Basel international banking rules, which tighten regulations on
bank capital. Critics say putting a regulatory squeeze on banks
hasn't made the system safer -- it's just made economic recovery
However, earlier this month central banks loosened a portion
of the Basel III rules. While that isn't a complete fix for the
problem regulators created, it is a step in the right direction,
"This suggests a more robust growth picture for 2013," Steve
Hanke, a Johns Hopkins economics professor and longtime critic of
Basel, recently wrote in Globe Asia magazine.
Hanke added that if the central bankers "were to scale back
Basel's capital-adequacy requirements, bank money growth would
almost certainly kick into a higher gear."
The economy and JPMorgan's earnings presumably would benefit
from such developments.
For all the problems in the financial sector in recent years,
fundamentals are improving
in many respects.
Return on equity was 11% in 2012, up for a fourth year in a
row. During the recession, ROE fell to 3%.
The three-year EPS Stability Factor is 10, a sharp improvement
from 47 over five years. The gauge runs from 0 (calm) to 99
Fund support was essentially unchanged in the second half of
2012, but Fidelity Contrafund and Magellan added to their
The dividend yield is 2.6%.