JPMorgan Chase (NYSE: JPM) reports earnings on Wednesday morning. Wall Street analysts are apparently looking for $0.93 EPS on revenues of $17 Billion according to First Call, although in this current environment it’s hard to imagine any bank or financial meeting or beating targets even if those targets have been lowered. Analysts still expect a slight growth for 2008 and that just seems silly in the environment today. But isn’t all bad at all banks and all financial institutions.
To say it is no secret that the financial sector is a wreck would be like saying you are an overpaid employee at the department of redundancy department. Tuesday was a pain for JPMorgan shares as Deutsche Bank downgraded the rating from a Buy (with $56 target) down to a Hold (with a new $44 target) as the firm believes that even the famed and notorious JPMorgan Chase won’t be able to entirely escape the woes in the financial sector right now. In fact, it fell worse than many other financials with a 5% drop down to $39.17 on nearly double volume and even slid to $38.50 in the after-hours session.
This particular report will be extra interesting, and it is actuallyfar more critical to the financial sector than others like Citigroup(NYSE: C). The reason for this is that JPMorgan Chase is supposed tohave the strongest credit base in its client base. It has a strongclient base like American Express (NYSE: AXP) does compared to manyVisa clearing member banks. Regardless of this, you know there aregoing to be problems. Chase’s delinquencies will certainly be upand it too will have charges, and if these analysts haven’t figured outthat it’s going to stay that way for a while then who knows what to sayabout them. But Chase is also a survivor and deserves to be in abetter spot than the rest of the sector. It’s also one of thepotential winners out of the Dogs of the Dow this year, as long as thissector can stabilize. Unlike other banks and financials we havetelegraphed which others would cut their dividend, the JPMorgan Chase dividend is probably a safe one.
RSS Updates
Email Updates
