JPMorgan Chase share price and Q1 earnings results preview

When are JPMorgan ’s results expected?

JPMorgan Chase & Co (All Sessions), the US multi-national banking behemoth, is set to release its first quarter (Q1) 2023 results on 14 April 2023. The results are for the quarter ending March 2023.

What is ‘The Street’s’ expectation for the FY results?

‘The Street’ expectations for the upcoming results are as follows:
Revenue of $36,070 billion : +14.18% year-on-year (YoY)
Earnings per Share (EPS) : $3.42: +23.86% (YoY)

JPMorgan - a bellwether for the US economy

Bank stocks are always closely-watched for the insight they provide into the US economy, especially now that softer US job opening data and weaker ADP employment numbers point to a slowdown in the US economy.

On Tuesday US job openings fell by 632k, a near 2-year low, and on Wednesday ADP employment numbers came in weaker than expected at 142k in March versus a forecast +200k and +242k in February.

This time around bank stocks are more important than usual, given the recent banking crisis and the fears that it may flare up again, especially with regards to US small- and medium-sized banks.

With JPMorgan kicking off the Q1 earnings season, should the bank beat estimates then this should provide a lift to risk appetite generally, and potentially result in an extension of the rally in stocks seen around the globe over the past couple of quarters.

Overall, higher interest rates and strong lending figures are expected to support the bank’s Q1 results, although lending is expected to have fallen off a cliff during the March banking crisis.

During the first quarter of this year, US interest rates continued to rise, reaching a fifteen-year high of 4.75-5.00%, as the Fed battled strong inflation readings.

While the US economy still faces a tough year, for now the overall picture remains relatively healthy, with trading volumes, investment banking fees, net interest margins and income from mortgage banking all likely to remain solid for JPMorgan.

How to trade JPMorgan into the results

Refinitiv data shows a consensus analyst rating of between ‘buy’ for JPMorgan – 5 strong buy, 14 buy and 8 hold - with the median of estimates suggesting a long-term price target of $156.00 for the share, roughly 21.5% higher than the current price (as of 5 April 2023).

IG sentiment data shows that 85% of clients with open positions on the share (as of 05 April 2023) expect the price to rise over the near term, while 15% of clients expect the price to fall whereas trading activity over this week and month shows 51% of sells.

JPMorgan – technical view

JPMorgan’s share price is struggling to recover from its swift March banking crisis sell-off which led to its share price dropping by as much as 14% before levelling out around the $130 mark.

JPMorgan Daily Chart

On the daily chart a rise and daily chart close above the 21 March high at $131.73 is needed for a bottom to be formed and for the October-to-April advance to resume.

While this level caps, just as it has done this week, downside pressure retains the upper hand with a retest of the $125 region remaining likely.

Were the March low at $123.11 to be slipped through, a medium-term top formation would be confirmed with the possibility opening up for the Junee-to-August levels of between $116 to $110 to be revisited. This is not our current preferred scenario, though.

Instead we expect the JPMorgan share price to gradually recover and for it to eventually regain its March peak at $144.34, followed by the psychological $150 region.