JP Morgan Chase releases disappointing Q4 earnings report

JP Morgan Chase has its worst revenue results in four years.

JP Morgan Chase building after Q4 earnings Source: Bloomberg

JP Morgan Chase stock is up despite missing earning estimates. JP Morgan Chase earnings were down in its fourth-quater ( Q4) profit report.

JP Morgan Chase key figures

Earnings per share ( EPS) $1.98 a share
Revenue $26.8 billion
Net Income $7.1 billion
Profits $7.08 billion
Corporate and banking revenue $ 15.7 bilion

JP Morgan Chase earnings

JP Morgan Chase’s revenue dropped to $26.8 billion, less than the $26.9 billion financial experts predicted. The corporate and investment banking revenue has declined by 4 %. Bond trading was down 18% for the worst trading since the US market collapse of 2008. Expenses increased by about $100 billion. The only bright spot was adjusted net income, which increased JP Morgan Chase profits 67% from 2018.

JP Morgan Chase chief executive officer, (CEO), Jamie Dimon, touted the bank’s Q4 results in its earnings report.

‘Our customer-centric business model has benefited from a healthy and engaged US consumer that is spending, saving, and investing.Despite a challenging quarter, we grew markets revenue in the Investment Bank for the year with record performance in Equities and solid performance in Fixed Income. Investment Banking fees were a record for the year, driven by strength in both CIB and Commercial Banking,' said Dimon.

This continues the positive outlook Dimon had about JP Morgan Chase’s financial outlook in the summer of 2018.

‘The way I look at it, there is nothing that is a real pothole. Business sentiment is almost at the highest level it's ever been, consumer sentiment is at its highest levels, markets are wide open, housing's in short supply and my guess is mortgage credit will expand a little bit,’ said Dimon.

Dimon was also hopeful about the bank being able to make loans even if there is an economic downturn in the US.

‘We tell our management that we have no problems seeing loan books shrink.Remember, Warren Buffett used to say in the insurance business, and sometimes this is true in the loan business, [there are times] when you're better off having the salesforce go play golf than make new loans. We are not going to be stupid', said Dimon.

What does JP Morgan Chase Q4 results mean for its stock price?

JP Morgan Chase stock is up after initially falling despite the disappointing news of its revenue report. JP Morgan Chase had a lackluster revenue report, but still recorded high net income, which could possibly be boosting its shares. Investors are also still confident that the bank is still a solid buy.

JP Morgan Chase outperforms other bank stocks

Compared to other reports from banks like Citigroup, the shares are slightly higher. In comparison to Wells Fargo stock is down after releasing its revenue report. JP Morgan Chase shares are performing slightly better than the other banks that released their revenue results. Despite the downturn in JP Morgan Chase revenue, investors are still bullish on the bank’s stock.

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