JPMorgan Chase & Co (NYSE:JPM) — Widely considered to be one of the leading global financial services companies, JPM stock has been praised for its excellent management.
Standard & Poor’s views JPM as a beneficiary of a number of growth catalysts, but higher interest rates, along with an improving economy and reduced regulations, are the main drivers in the next several years.
S&P projects earnings of $6.47 in 2017 and $7.25 in 2018.
Even though JPM has agreed to pay $797.5 million to settle the remaining litigation relative to the collapse of Lehman Brothers, and this follows a $1.42 billion payment, the firm is so strong as to absorb the losses.
And management was cleared by a judge overseeing the case of any improprieties in the clearing and custodianship of Lehman.
Thus S&P rates JPM as a “four-star buy” with a 12-month target of $98 based on 15.1X their earnings estimate.
Technically, JPM stock is in minor consolidation following an advance from about $68 in November to a high of almost $94 in February. Near-term support rests within a zone of $83.30 to $87.55 with near-term resistance at the 50-day moving average ($88.45) and then the descending triangle’s 20-day moving average now at $90.83.
Note the CBR Buy on Wednesday from my internal indicator, which, when coupled with an oversold MACD, provides a strong technical case for buyers. Traders should try to buy JPM at under $87 with a target of $100. Long-term investors may take a position in this A- (S&P) rated stock for income (annualized dividend yield of 2.3%) and long-term growth.
– Sam Collins, Trade of the Day
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Source: Investor Place