"If you look at the fundamentals without the litigation charges, they are still producing about a 15% return on average tangible common equity, even backing out the [loan loss] reserve release," according to Mosby.
Another factor in the stock's strong performance is the quarterly dividend of 38 cents, which equates to a yield of 2.88%, based on Wednesday's closing price.
That dividend is not likely to be affected by JPMorgan's regulatory and legal mess, since it was approved in March by the Federal Reserve as part of the regulator's annual stress test process, which for the largest banks holds dividends to roughly 30% of earnings.
The dividend provides a $50 "floor" for the stock, according to Mosby, because at that point the yield would be 3%. The analyst rates JPMorgan a "buy," with a price target of $63.00."Over the next year, the downside risk is minimal, with a lot of upside potential, if they can get through this settlement without causing anymore heartburn," he says. JPM data by YCharts
Interested in more on JPMorgan Chase? See TheStreet Ratings' report card for this stock.
Email. Follow @PhilipvanDoorn
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV