This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

JPMorgan Unmoved by Upgrade

NEW YORK ( TheStreet) -- JPMorgan Chase (JPM - Get Report) shares didn't seem phased on Friday after Citigroup upgraded the stock, calling the stock's recent underperformance an "excellent entry point."

Citigroup analyst Keith Horowitz raised his rating on JPMorgan shares to buy from hold, but the stock was trading slightly lower in recent action, down less than 1 percent to $40.18. That decline follows a plus 5% sell-off for the stock on Thursday after President Obama unveiled proposals to limit the size of banks and their ability to engage in certain investing activites, like hedge and private equity funds and proprietary trading.

Horowitz notes that the stock was off 3% overall in 2010 vs. a gain of 11% in the Keefe Bruyette & Woods bank index over the same period. His 12-month target for the shares is $48.

Quantifying the impact of Obama's proposed reforms on individual companies is difficult this early in the game, and that uncertainty is part of why the stocks of JPMorgan, Bank of America (BAC - Get Report), and Goldman Sachs (GS - Get Report) have been so roiled by the news.

Horowitz estimates that the removal of proprietary trading "would have a limited 2% impact on normalized EPS from assuming forced divestiture of private equity," for JPMorgan. "The other risk is [the] impact of 'size limits,' but we assign a very low probability that JPM will be forced to downsize its balance sheet given impact on credit availability," he writes.

From a fundamental standpoint, Horowitz is bullish on JPMorgan because the company has been proactive about containing credit losses and has a "superior" capital position.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $14.06 -2.10%
GS $159.56 -2.20%
JPM $61.52 -1.70%
AAPL $94.01 -1.20%
FB $117.53 0.08%


Chart of I:DJI
DOW 17,646.54 -104.37 -0.59%
S&P 500 2,049.42 -13.95 -0.68%
NASDAQ 4,722.6130 -40.6110 -0.85%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs