We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Analyst Blog Highlights Citigroup, JPMorgan & Chase and Bank of America
Read MoreHide Full Article
For Immediate Releases
Chicago, IL – July 8, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Citigroup Inc. (C - Free Report) , JPMorgan & Chase, Inc. (JPM - Free Report) and Bank of America Corp. (BAC - Free Report) .
Here are highlights from Monday’s Analyst Blog:
These 3 Bank Stocks Are Hitting New 52-Week Highs
Investors often use 52-week highs to pick an entry or exit point for a certain company. When a stock sets a new 52-week high, it signifies positive momentum and suggests that the price has been steadily growing over the last 52 weeks. This might attract more investors and traders who regard the stock as a great performer and want to ride the current rising trend.
Stocks that reach new 52-week highs are generally prone to profit-taking, resulting in pullbacks and trend reversals. Given the stock's high price, investors frequently ask if it is overvalued. While the speculation is not completely unfounded, not all companies that reach a 52-week high are expensive.
To avoid the high pricing, investors may miss out on top performers.
Major banks like Citigroup Inc., JPMorgan & Chase, Inc. and Bank of America Corp. are expected to maintain their momentum and keep scaling new highs.
Year-to-date, all three stocks have outperformed the industry.
To determine whether a stock has room for more upside, let’s delve deeper
What Cheered the Investors?
Before discussing the banks mentioned above, let’s discuss the factors driving these banks to scale at a new high.
An important contributing component to the positive aspects was the Federal Reserve's hint that interest rates will be cut later in 2024. While market players had expected the first rate cut to come in March, new economic data indicated that the central bank would hold off on raising rates until it had more evidence that inflation was abating. In September, the Fed is expected to lower interest rates for the first time since March 2020.
As the central bank kept the rates stable at 5.25-5.5% since July 2023, deposit costs are gradually stabilizing and even coming down for many lenders. Pressure on the net interest margin will likely decline eventually and will allow banks to have a stable/improving net interest income (NII).
Banks are also making efforts to diversify their revenue streams to reduce dependency on spread income. Lately, several banks are acquiring/forming partnerships to strengthen non-interest income. Banks are venturing into the lucrative private credit business to capitalize on the growing demand for alternative financing options.
These factors are driving investors’ confidence in banking stocks. Several banking stocks are touching new highs based on investors’ optimism.
Top Picks: More Upside to Continue
Citigroup: As a globally diversified financial services holding company, Citigroup continues to emphasize growth in core businesses through streamlining consumer banking operations globally. In June 2024, Citigroup completed the sale and migration of its onshore China-based consumer wealth portfolio to HSBC Bank China, a wholly-owned subsidiary of HSBC Holdings plc. The company is on track to separate its business in Mexico by the second half of 2024, followed by an IPO in 2025.
As part of the company’s broader strategy, it launched Citi Commercial Bank (“CCB”) in Japan to expand its commercial banking in key growth areas across certain clusters. This launch follows CCB’s introduction in France and Ireland in 2023, preceded by its launch in Germany, Switzerland and Canada in 2022.
Following the clearance of the 2024 stress test, C plans to raise its quarterly dividend by 6% to 56 cents per share. However, given the current challenging operating backdrop, the company ‘will continue to assess share repurchases on a quarter-to-quarter basis.’
The Zacks Consensus Estimate for C’s 2024 earnings has remained steady at $5.88 per share in the past seven days. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 20.03%.
Citigroup crafted a 52-week high, touching $65.22 before closing the session at $64.46 on Jun 3.
JPMorgan: The largest U.S. bank, JPMorgan, is likely to gain from higher rates, loan growth, strategic acquisitions, business diversification efforts, strong liquidity position and initiatives to expand the branch network in new markets.
The bank keeps expanding its footprint in new regions. In February, the company announced plans to open more than 500 new branches by 2027. This initiative will solidify its position as the bank with the largest branch network and a presence in all 48 states in the United States.
JPMorgan continues to focus on acquiring the industry's best deposit franchise and strengthening its loan portfolio. As of Mar 31, 2024, the loans-to-deposit ratio was 54%. The company will be able to capitalize on its scale to record decent loan growth in the future.
JPM intends to increase its quarterly dividend for the second time this year as it cleared the 2024 stress test. The company plans to hike the dividend by 9% to $1.25 per share after announcing a 10% rise in March. JPM also authorized a new $30-billion share repurchase program, effective Jul 1, 2024.
The Zacks Consensus Estimate for JPM’s 2024 earnings has revised marginally upward to $16.50 per share in the past week. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 12.31%.
JPM touched a 52-week high of $210.38 before closing the session at $208.69 on Jun 3.
Bank of America: One of the largest financial holding companies in the United States, Bank of America is expected to keep benefitting from the current high-rate regime and decent loan demand.
The bank embarked on an ambitious expansion plan to open financial centers in new and existing markets. By 2026, it plans to expand its financial center network into nine new markets. The bank is committed to providing modern and state-of-the-art financial centers through ongoing renovation and modernization projects.
Bank of America is focused on acquiring the industry's best deposit franchise and strengthening the loan portfolio. Despite a challenging operating environment, deposits and loan balances have remained solid in the past several years.
Following the clearance of the 2024 stress test, Bank of America intends to raise its quarterly dividend by 8.3% to 26 cents per share.
The Zacks Consensus Estimate for BAC’s 2024 earnings has been revised marginally upward to $3.24 per share in the past seven days. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 62.8%.
BAC touched a 52-week high of $41.20 before closing the session at $40.90 on Jun 3.
Parting Thoughts
The three bank stocks — C, JPM and BAC — enjoy terrific growth prospects. They also have plenty of room to run even higher. Thus, investors must keep these stocks on their radar and wait for an attractive entry point.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Zacks Analyst Blog Highlights Citigroup, JPMorgan & Chase and Bank of America
For Immediate Releases
Chicago, IL – July 8, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Citigroup Inc. (C - Free Report) , JPMorgan & Chase, Inc. (JPM - Free Report) and Bank of America Corp. (BAC - Free Report) .
Here are highlights from Monday’s Analyst Blog:
These 3 Bank Stocks Are Hitting New 52-Week Highs
Investors often use 52-week highs to pick an entry or exit point for a certain company. When a stock sets a new 52-week high, it signifies positive momentum and suggests that the price has been steadily growing over the last 52 weeks. This might attract more investors and traders who regard the stock as a great performer and want to ride the current rising trend.
Stocks that reach new 52-week highs are generally prone to profit-taking, resulting in pullbacks and trend reversals. Given the stock's high price, investors frequently ask if it is overvalued. While the speculation is not completely unfounded, not all companies that reach a 52-week high are expensive.
To avoid the high pricing, investors may miss out on top performers.
Major banks like Citigroup Inc., JPMorgan & Chase, Inc. and Bank of America Corp. are expected to maintain their momentum and keep scaling new highs.
Year-to-date, all three stocks have outperformed the industry.
To determine whether a stock has room for more upside, let’s delve deeper
What Cheered the Investors?
Before discussing the banks mentioned above, let’s discuss the factors driving these banks to scale at a new high.
An important contributing component to the positive aspects was the Federal Reserve's hint that interest rates will be cut later in 2024. While market players had expected the first rate cut to come in March, new economic data indicated that the central bank would hold off on raising rates until it had more evidence that inflation was abating. In September, the Fed is expected to lower interest rates for the first time since March 2020.
As the central bank kept the rates stable at 5.25-5.5% since July 2023, deposit costs are gradually stabilizing and even coming down for many lenders. Pressure on the net interest margin will likely decline eventually and will allow banks to have a stable/improving net interest income (NII).
Banks are also making efforts to diversify their revenue streams to reduce dependency on spread income. Lately, several banks are acquiring/forming partnerships to strengthen non-interest income. Banks are venturing into the lucrative private credit business to capitalize on the growing demand for alternative financing options.
These factors are driving investors’ confidence in banking stocks. Several banking stocks are touching new highs based on investors’ optimism.
Top Picks: More Upside to Continue
Citigroup: As a globally diversified financial services holding company, Citigroup continues to emphasize growth in core businesses through streamlining consumer banking operations globally. In June 2024, Citigroup completed the sale and migration of its onshore China-based consumer wealth portfolio to HSBC Bank China, a wholly-owned subsidiary of HSBC Holdings plc. The company is on track to separate its business in Mexico by the second half of 2024, followed by an IPO in 2025.
As part of the company’s broader strategy, it launched Citi Commercial Bank (“CCB”) in Japan to expand its commercial banking in key growth areas across certain clusters. This launch follows CCB’s introduction in France and Ireland in 2023, preceded by its launch in Germany, Switzerland and Canada in 2022.
Following the clearance of the 2024 stress test, C plans to raise its quarterly dividend by 6% to 56 cents per share. However, given the current challenging operating backdrop, the company ‘will continue to assess share repurchases on a quarter-to-quarter basis.’
The Zacks Consensus Estimate for C’s 2024 earnings has remained steady at $5.88 per share in the past seven days. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 20.03%.
Citigroup crafted a 52-week high, touching $65.22 before closing the session at $64.46 on Jun 3.
JPMorgan: The largest U.S. bank, JPMorgan, is likely to gain from higher rates, loan growth, strategic acquisitions, business diversification efforts, strong liquidity position and initiatives to expand the branch network in new markets.
The bank keeps expanding its footprint in new regions. In February, the company announced plans to open more than 500 new branches by 2027. This initiative will solidify its position as the bank with the largest branch network and a presence in all 48 states in the United States.
JPMorgan continues to focus on acquiring the industry's best deposit franchise and strengthening its loan portfolio. As of Mar 31, 2024, the loans-to-deposit ratio was 54%. The company will be able to capitalize on its scale to record decent loan growth in the future.
JPM intends to increase its quarterly dividend for the second time this year as it cleared the 2024 stress test. The company plans to hike the dividend by 9% to $1.25 per share after announcing a 10% rise in March. JPM also authorized a new $30-billion share repurchase program, effective Jul 1, 2024.
The Zacks Consensus Estimate for JPM’s 2024 earnings has revised marginally upward to $16.50 per share in the past week. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 12.31%.
JPM touched a 52-week high of $210.38 before closing the session at $208.69 on Jun 3.
Bank of America: One of the largest financial holding companies in the United States, Bank of America is expected to keep benefitting from the current high-rate regime and decent loan demand.
The bank embarked on an ambitious expansion plan to open financial centers in new and existing markets. By 2026, it plans to expand its financial center network into nine new markets. The bank is committed to providing modern and state-of-the-art financial centers through ongoing renovation and modernization projects.
Bank of America is focused on acquiring the industry's best deposit franchise and strengthening the loan portfolio. Despite a challenging operating environment, deposits and loan balances have remained solid in the past several years.
Following the clearance of the 2024 stress test, Bank of America intends to raise its quarterly dividend by 8.3% to 26 cents per share.
The Zacks Consensus Estimate for BAC’s 2024 earnings has been revised marginally upward to $3.24 per share in the past seven days. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 62.8%.
BAC touched a 52-week high of $41.20 before closing the session at $40.90 on Jun 3.
Parting Thoughts
The three bank stocks — C, JPM and BAC — enjoy terrific growth prospects. They also have plenty of room to run even higher. Thus, investors must keep these stocks on their radar and wait for an attractive entry point.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.