Earnings Review and Free Research Report: JPMorgan’s Q3 EPS Rose 11% Y-o-Y; Outshone Expectations

LONDON, UK / ACCESSWIRE / October 17, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on JPMorgan Chase & Co. (NYSE: JPM) ("JPMorgan"), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=JPM, following the Company's release of its financial results on October 12, 2017, for the third quarter of the fiscal year 2017 (Q3 FY17). The New York-based bank's quarterly net revenues and diluted EPS grew 3% and 11% y-o-y, respectively; outperforming Wall Street's forecasts. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Earnings Reviewed

During the three months ended September 30, 2017, JPMorgan reported total net revenues of $25.33 billion, which were above the $24.67 billion recorded in Q3 FY16. The Company's managed total revenues increased to $26.20 billion in Q3 FY17 compared to $25.51 billion in the year-ago corresponding period. The managed total net revenues also beat market consensus estimates of $25.7 billion.

In Q3 FY17, JPMorgan's managed net interest income grew 10% to $13.12 billion y-o-y from $11.90 billion in the last year's comparable quarter. The growth in net interest income was primarily driven by the net impact of rising rates and loan growth, partially offset by declines in markets net interest income. Meanwhile, managed non-interest revenues fell 4% to $13.08 billion in Q3 FY17 from $13.61 billion in Q3 FY16, driven by lower markets revenues.

The financial services firm's net income applicable to common stockholders came in at $6.73 billion, or $1.76 per diluted share, for Q3 FY17 rising from $6.29 billion, or $1.58 per diluted share, in Q3 FY16. The net income figures outshone Wall Street's estimates of $1.67 per diluted share.

Performance Metrics

JPMorgan reported return on assets of 1.04% in Q3 FY17 versus 1.01% in the year-ago comparable quarter. The return on common equity rose to 11% in Q3 FY17 from 10% reported in last year's same period. Additionally, the bank's tangible return on common equity came in flat at 13% for the reported quarter.

As on September 30, 2017, the Company's Basel III common equity Tier 1 capital under advanced transitional approach stood at $187.06 billion, or 12.9%, compared to $181.61 billion, or 12.0%, in the year-ago corresponding quarter. The Company's Basel III Tier 1 capital ratio under advanced transitional approach was 14.7% at the end of Q3 FY17 compared to 13.6% at the close of Q3 FY16. Additionally, tangible book value per share stood at $54.03 as on September 30, 2017, up 5% from $51.23 per share as on September 30, 2016.

Segment Performance

In Q3 FY17, Consumer & Community Banking segment's revenues grew 6% to $12.03 billion from $11.33 billion in prior year's comparable quarter. Meanwhile, the segment's net income surged 16% to $2.55 billion y-o-y in Q3 FY17 from $2.20 billion in Q3 FY16.

Corporate & Investment Bank segment's revenues came in at $8.59 billion for Q3 FY17, which was 9% lower than the $9.46 billion reported in the year-ago same quarter. Meanwhile, the segment's net income declined 13% to $2.55 billion in Q3 FY17 from $2.91 billion in Q3 FY16.

Commercial Banking segment's net revenues stood at $2.15 billion, up 15% y-o-y, primarily driven by higher net interest income due to higher deposit spreads and loan growth. The segment's net income also rose 13% to $881 million y-o-y in the reported quarter.

Asset Management segment's net revenues grew 6% to $3.25 billion in Q3 FY17 from $3.05 billion in Q3 FY16; reflecting higher market levels and strong banking results driven by higher deposit spreads. The segment contributed $674 million to combined net income in Q3 FY17, compared to $557 million in the previous year's corresponding period.

Meanwhile, Corporate segment reported net revenues of $186 million compared to net income of $78 million in Q3 FY17.

Dividend and Share Repurchase

In a separate press release on September 19, 2017, JPMorgan's Board of Directors hiked the quarterly dividend from $0.50 per share to $0.56 per share. The dividend is payable on October 31, 2017, to shareholders of record at the close of business on October 06, 2017.

The Company informed Wall Street that it had returned capital worth $6.5 billion to its shareholders in Q3 FY17, which included $4.5 billion of net share buyback and $0.56 per share in form of quarterly cash dividend.

Guidance

In its outlook for the full year FY17, the Company expects net interest income to rise $4.0 billion y-o-y. JPMorgan anticipates adjusted expenses to be approximately $58 billion during FY17 and forecasts net charge-offs during FY17 to be +/- $5 billion. Furthermore, the Company forecasts average core loan growth to be approximately 8%.

Stock Performance

At the closing bell, on Monday, October 16, 2017, JPMorgan Chase's stock climbed 2.07%, ending the trading session at $97.84. A total volume of 12.43 million shares have exchanged hands, which was higher than the 3-month average volume of 12.10 million shares. The Company's stock price soared 7.43% in the last three months, 14.89% in the past six months, and 44.91% in the previous twelve months. Moreover, the stock surged 13.39% since the start of the year. The stock is trading at a PE ratio of 14.03 and has a dividend yield of 2.29%. The stock currently has a market cap of $344.76 billion.

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