In recent times, JPMorgan, Citigroup, and Wells Fargo all reported earnings for the first quarter that exceeded analysts' estimates. However, they maintained their interest income projections unchanged, notwithstanding potential advantages stemming from the Federal Reserve's hesitancy to reduce interest rates. As a result, JPMorgan's shares plummeted by approximately 6% in a single day.
JPMorgan Q1 Earnings Review
JPMorgan Chase & Co. has disclosed an improvement in its first quarter profit for 2024, as net income escalated from $12.62 billion to $13.42 billion. A year ago, earnings per share increased to $4.10 during the same period; they were amended to $4.64 per share.
From the previous quarter onwards, net interest income decreased marginally by 1% to $23.08 billion. The bank now projects that its enterprise-wide net interest income for the fiscal year 2024 will increase to around $90 billion from its previous estimate of $88 billion.
The first quarter witnessed a 9% increase in total revenue to $41.93 billion, up from $38.35 billion in the same period last year. Net revenue was reported at $42.5 billion. Additionally, JPMorgan Chase anticipates that firm-wide adjusted expenses will hover around $91 billion in 2024.
In addition to the $2.9 billion charge recorded in the prior quarter, the bank accounted for a special charge of $725 million to resolve with the Federal Deposit Insurance Corp. regarding bank failures that occurred last year. In addition, it anticipates a net charge-off rate for card services that is below 3.50%.
Analysts Projection On JPMorgan Stock (JPM)
Analysts have revised their initial estimate of JPMorgan's net interest income in 2024 from approximately $70 billion to $90 billion. On the contrary, the projected value of non-interest income increased marginally from $69 billion to $72 billion.
In anticipation of future events, the capacity to consistently adjust to evolving conditions surpasses momentary uncertainties. This philosophy explains, in part, why JPMorgan is valued three times more than Citigroup, given that investors seek direction and clarity in a volatile market.
JPM Stock Forecast Technical Analysis
In the daily chart of JPM stock price, strong downside pressure is seen in the daily chart where the broader context remains bullish. The downbeat earnings projected a possible threat of a recession pushed the stock price down below the dynamic 50-day Exponential Moving Average.
Based on this outlook, the upward continuation needs a valid bullish rejection from a possible bottom. As of now, the price still trades above the 50% Fibonacci Retracement level of the current swing, which is at the 168.05 level. Moreover, the 200-day Simple Moving Average is below the major support line with a bullish slope, suggesting a major bullish wave.
Investors should closely monitor how the price reacts in the 176.00 to 168.00 zone, from where a bullish reversal with a daily candle could be a potential long opportunity. However, a downside pressure below the 164.00 psychological line might lower the price towards the 148.00 zone.
