BlueChip Breakdown: JPM

By Will Svendsen

08/19/2025

📌Company Snapshot

• Sector: Financial Services / Banking

• Market Cap: ~$820B (Macrotrends)

• Business: JPMorgan Chase is the largest U.S. bank, providing retail banking, commercial lending, investment banking, asset & wealth management, and trading services worldwide.

• Core Revenue Driver: Net interest income from lending + fee-based revenues (trading, investment banking, asset management).

📈Recent Performance

• Stock up ~16% YTD, outperforming KBW Bank Index but lagging tech-heavy S&P 500.

• Q2 2025 EPS: $4.96 vs $4.48 est. — beat expectations despite tough comps (last year had a one-time $8B Visa gain).

• Net profit: $14.99B, down 17% YoY due to that Visa gain in 2024.

• Trading revenue +15% YoY ($8.9B); investment banking fees +7% ($2.5B).

• Raised FY25 net interest income guidance to ~$95B.

• Announced $50B buyback and dividend increase after passing Fed stress test.

• Jamie Dimon highlighted U.S. economic resilience but warned of fiscal deficits, tariffs, and geopolitical risks.

Source: Reuters

📊Key Metrics & Valuation

• P/E (FWD): ~14.9x (Yahoo Finance)

• P/B Ratio: ~2.8x (MarketWatch)

• ROE: ~18%

• Dividend Yield: ~2.4%

• 5Y Revenue CAGR: ~7% (Macrotrends)

💰DCF Summary (Internal BCB Model, Aug 2025)

• WACC: 9.0%

• FCF CAGR (next 5 yrs): ~5%

• Terminal Growth: 2.0%

• Equity Value: ~$750B

• Shares Outstanding (2025): ~2.82B

• Intrinsic Share Price: ~$266

• Current Price (Aug 19, 2025): ~$291

Source: Internal BCB DCF Model (Aug 2025)

⚖️Catalysts & Risks

Catalysts

• Strong buyback and dividend commitment ($50B authorization).

• Diversified revenue mix supports resilience in different economic cycles.

• Leading global position in investment banking and trading.

Risks

• Valuation premium vs peers (14.9x vs ~12.6x sector average).

• Sensitive to U.S. and global macro shocks (rates, tariffs, deficits).

• Heavy reliance on capital markets activity and corporate health.

✅BlueChip Breakdown Rating: Hold / Wait

JPM remains the best-run U.S. bank with diversified earnings power and elite management. However, at ~15x earnings and trading near all-time highs, the stock looks fully priced. For existing shareholders, it’s a solid Hold thanks to strong dividends and buybacks. For new investors, it’s best to Wait for a better entry point on market pullbacks.