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10 New York Bank Stocks With Most Upside for 2012

5. JPMorgan Chase

Shares of JPMorgan Chase (JPM - Get Report) closed at $31.89 Friday, declining 23% year-to-date. Based on a 25-cent quarterly payout, the shares have a dividend yield of 3.14%. Based on the mean price target of $45.88 among analysts polled by FactSet, the shares have 44% upside potential.

JPMorgan stands out among the largest U.S. banks with that generous dividend payout, and following the next round of Federal Reserve stress tests, investors are hoping for an increased return of capital, with a higher dividend and/or share buybacks.

Please see TheStreet's earnings coverage for discussion of the company's third-quarter results.

Credit Suisse analyst Moshe Orenbuch on Monday said that JPMorgan was one of his firm's "top picks" among bank stocks for 2012, "due to strength and stability of the company's senior leadership team and strong balance sheet." Orenbuch sees "increased capital deployment activities in the form of higher dividends and share buyback as a positive catalyst," and is well ahead of the consensus, with a $52 price target for the shares, which is "1.4 times forward tangible book value and 10.4 times earnings," which Credit Suisse estimates will be $5.00 a share in 2012.

Of course, there will still be some major headline risk, with implied volatility for the shares, in 2012. Orenbuch estimates that JPM subsidiary Chase Home Finance -- the third-largest mortgage loan servicer as of March 31, according to Credit Suisse, citing data supplied by Inside Mortgage Finance -- will pay between $2.8 billion and $4.6 billion, as part of a settlement between the largest servicers, the federal bank regulators, and the states' attorneys general.

The shares trade for 6.5 times the consensus 2012 EPS estimate of $4.88 among analysts polled by FactSet, and for just below times tangible book value, according to SNL Financial.

Out of 25 analysts covering JPMorgan Chase, 23 rate the shares a buy and two have neutral ratings.

Interested in more on JPMorgan Chase? See TheStreet Ratings' report card for this stock.

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