NEW YORK (TheStreet) -- JPMorgan (JPM) - Get JP Morgan Chase & Co. Report announced yesterday evening that is launching a mobile payments system called "Chase Pay" that will rival services such as Apple's (AAPL) "Apple Pay."
The biggest U.S. bank is partnering with members of the Merchant Customer Exchange (MCX) such as Wal-Mart (WMT), Target (TGT), Shell (RDS.A) and Best Buy (BBY). Retailers in the MCX bring in more than $1 trillion in sales each year and have more than 100,000 outlets, Reuters reports.
Apple Pay has struggled to partner with retailers, and two-thirds of the top 100 retailers surveyed by Reuters in June said they would not partner with the service during 2015, Reuters notes.
Additionally, Chase Pay touts tighter security and a lower fee for retailers accepting Chase Pay transactions. JPMorgan hopes to cover the difference from lower fees with greater volume within its network, according to Reuters.
The system is scheduled to be released to the company's 94 million credit, debit and pre-paid card accounts during mid-2016.
"The whole thing is about scale, and Chase is a titan," David Robertson, publisher of the Nilson Report, told Reuters.
Shares of JPMorgan are slumping by 0.80% to $63.39 in midday trading on Tuesday.
Separately, TheStreet Ratings team rates JPMORGAN CHASE & CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
We rate JPMORGAN CHASE & CO (JPM) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, expanding profit margins and attractive valuation levels. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- JPMORGAN CHASE & CO has improved earnings per share by 23.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, JPMORGAN CHASE & CO increased its bottom line by earning $5.29 versus $4.32 in the prior year. This year, the market expects an improvement in earnings ($5.98 versus $5.29).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Commercial Banks industry average. The net income increased by 22.1% when compared to the same quarter one year prior, going from $5,572.00 million to $6,804.00 million.
- The gross profit margin for JPMORGAN CHASE & CO is currently very high, coming in at 89.85%. Regardless of JPM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, JPM's net profit margin of 27.66% compares favorably to the industry average.
- You can view the full analysis from the report here: JPM