5. JPMorgan Chase is a global financial services firm operating in commercial banking, investment banking, asset management and private equity.
The company reported 2011 second-quarter net income of $5.4 billion, vs. $4.8 billion in the first quarter of the prior year. JPMorgan's investment banking and commercial banking operations fared well, while credit card charge-offs improved during the quarter. On the mortgage front, net charge-offs remain elevated and management expects credit losses in this segment to remain significant.
Regarding the company's balance sheet, CEO Jamie Dimon said, "We maintained our fortress balance sheet, ending the second quarter with a Basel I Tier 1 Common ratio of 10.1%. Our strong and growing capital base enabled us to buy back $3.5 billion of stock during the second quarter, and we will continue to buy back stock opportunistically. We estimate that our Basel III Tier 1 Common ratio was approximately 7.6% at the end of the second quarter. This level is well in excess of what is required today under existing rules and is greater than the level we expect will be required under the proposed rules for up to five years."
JPMorgan provided credit and raised more than $990 billion capital and originated mortgages, offered credit cards, increased credit to small businesses, and lent to nonprofit organizations, government agencies and corporations.
The stock is trading at a P/E of 6.6 based on estimated 2011 earnings. On average, analysts expect the stock to rise 57% over the next year.