JPMorgan Chase & Co. (NYSE: JPM), the global financial services firm with assets of $2.4 trillion, reported its fiscal 2016 second-quarter results that topped the analysts’ estimates. Furthermore, the revenue and earnings were higher than the y-o-y quarter. As a result, the markets, to a certain extent, had no second thought in pushing the share price near to the 12-month high of $70.61. Considering the signs of firm uptrend seen in the financial markets world over, we believe that the share price of JPMorgan Chase is all set for a strong ascend in the weeks to come. The share price closed at $63.96 on Monday.
The New York-based JPMorgan Chase, with operations in over 100 countries, reported a 3% increase in the net revenue to $25.21 billion in the second quarter of 2016, from $24.53 billion in the second quarter of 2015. The reported second-quarter revenue is greater than the Thomson Reuters estimates of $24 billion.
For the second quarter, the company serving millions of consumers and small businesses recorded a marginal decline in the net income to $6.2 billion or $1.55 per share, from $6.29 billion or $1.54 per share in the corresponding quarter of 2015. On a per-share basis, however, the second-quarter earnings were $0.01 higher at $1.55, compared to $1.54 in the prior year’s similar quarter. The earnings estimate of analysts was $1.35 per share.
The second-quarter non-interest expense declined to $13.64 billion, from $13.84 billion in the prior year’s corresponding quarter.
In spite of the difficult business environment, the Commercial banking division reported a 33% y-o-y rise in the net income to $696 million. Similarly, the Asset Management division posted a net income of $521 million, up 16% on a y-o-y basis. The Corporate and Investment Bank (CIB) segment’s net income was $2.49 billion, compared to $2.34 billion last year. The Consumer and Community banking segment saw a 5% y-o-y growth to $2.66 billion. Thus, it is clear that the company is recording consistent growth in all its segments. So, fundamentally, the chance of a rise in the share price is higher.
The stock has risen after testing the support level of 58 in the first week of July. The next major resistance for the stock is at 70. The stock is trading firmly above the 50-day moving average. Furthermore, the RSI has gone past the 50 levels, thereby indicating bullish in the counter.
A binary trader can consider taking a long position through the purchase of a one-touch call option from a reliable binary broker. The strike price for the call option should not be greater than $70, under the prevailing circumstances. An expiry date in the second week of August would be ideal for the trade setup.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
