JPMorgan Earnings: Solid Results Despite Capital Markets Softening

Key Morningstar Metrics for JPMorgan Chase

• Fair Value Estimate
  : $330.00
• Morningstar Rating
  : ★★★
• Morningstar Economic Moat Rating
  : Wide
• Morningstar Uncertainty Rating
  : Medium

What We Thought of JPMorgan Chase’s Earnings

JPMorgan Chase JPM reported decent third-quarter results, with net revenue up 8.0% and diluted earnings per share up 9.9% from a year ago. The shares were flat during Oct. 13 trading, as investors weighed softer capital markets activity against an improved net interest income outlook.

Why it matters: The scorching-hot start for capital markets in 2026 lost a bit of steam during the third quarter, though we believe the tailwind of a more constructive near-term rate environment more than offsets some normalization in markets revenue.

• After the Federal Reserve raised the federal-funds rate by 25 basis points to a targeted range of 3.75%-4.0%, we were pleased by JPMorgan’s revised guidance, as anticipated net interest income is now in line with our full-year 2026 forecast without an increase in card net charge-offs.
• Markets revenue of $10.3 billion represented a 15% improvement from a year ago but a 15% contraction from the prior quarter. We believe equities growth, again up 49% from a year ago, will prove unsustainable, and we forecast a harsh correction in 2028.

The bottom line: After digesting these results, we are raising our fair value estimate for wide-moat JPMorgan to $330 per share from $326, as robust lending demand and continued strength in deposit-gathering look keen to benefit from a higher rate environment. We view the shares as fairly valued.

• Our downward revisions in near-term trading revenue for the well-diversified behemoth are more than offset by higher near-term yields and stronger loan growth across the consumer and commercial banking franchises, calling for net interest income to grow by double digits again in 2027.
• While we believe trading revenue should not structurally outgrow the economy ad infinitum and view a pronounced contraction as inevitable over the medium term, our lowered near-term forecasts still imply fourth-quarter 2026 and full-year 2027 growth of 13.0% and 6.8%, respectively.