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JPMorgan (JPM) Misses on Q4 Earnings & Revenues Estimates

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Have you been eager to see how JPMorgan (JPM - Free Report) performed in Q4 in comparison with the market expectations? Let’s quickly scan through the key facts from this New York-based major global bank’s earnings release this morning:

An Earnings Miss

JPMorgan came out with earnings of $1.98 per share, which missed the Zacks Consensus Estimate of $2.20.

Improved revenues were offset by a rise in expenses.

How Was the Estimate Revision Trend?

You should note that the earnings estimate revisions for JPMorgan depicted pessimistic stance prior to the earnings release. The Zacks Consensus Estimate moved 1.3% down over the past 30 days.

Nonetheless, JPMorgan have an impressive earnings surprise history. Before posting the earnings miss in Q4, the company delivered positive surprises in all prior four quarters, as shown in the chart below:

JPMorgan Chase & Co. Price and EPS Surprise

 

JPMorgan Chase & Co. Price and EPS Surprise | JPMorgan Chase & Co. Quote

Overall, the company has a positive earnings surprise of 3.9% in the trailing four quarters.

Revenue Lower Than Expected

JPMorgan recorded revenues of $26.1 billion, which lagged the Zacks Consensus Estimate of $26.7 billion. However, it compared favorably with the year-ago number of $24.5 billion.

Key Q4 Statistics:
 

  • Investment banking fees were flat year over year
  • Fixed Income Markets revenue declined 16% year over year
  • Equity Markets revenues grew 15% year over year
  • Provisions for credit losses increased 18% year over year
  • Average Core loans up 7% year over year
  • Returned nearly $8.3 billion to shareholders through dividends and share buybacks
  • Basel III common equity Tier 1 ratio of 12.0%, as of Dec 31, 2018


What Zacks Rank Says

The estimate revisions that we discussed earlier have driven a Zacks Rank #3 (Hold) for JPMorgan. However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. While things apparently look unfavorable, it all depends on what sense the just-released report makes to the analysts.

(You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.)

How the Market Reacted So Far

Following the earnings release, JPMorgan’s shares were down 2.1% in the pre-trading session. This is in contrast to what the stock witnessed in the prior-day’s session. Clearly, the initial reaction shows that the investors have not considered the results in their favor. However, the full-session’s price movement may indicate a different picture.

Check back later for our full write up on this JPMorgan earnings report!

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