A month has gone by since the last earnings report for JPMorgan Chase & Co. (JPM Quick QuoteJPM - Free Report) . Shares have added about 8.7% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is JPMorgan Chase & Co. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

JPMorgan's Q4 Earnings Beat on Solid IB & Trading, NII Down on Lower Rates

Solid IB and trading performance drove JPMorgan’s fourth-quarter 2024 earnings to $4.81 per share. The bottom line handily surpassed the Zacks Consensus Estimate of $4.03.

Behind The Headline Numbers

As expected, the IB business witnessed solid growth. Equity underwriting fees jumped 54% and debt underwriting fees grew 56%. Also, advisory fees rose 41%. Overall, total IB fees (in the Commercial & Investment Bank segment) were up 49% from the prior-year quarter to $2.48 billion. 

Markets revenues soared 21% to $7 billion. Specifically, fixed-income markets revenues jumped 50% to $5 billion, while equity trading numbers surged 22% to $2 billion. Our estimates for equity and fixed-income markets revenues were $2.56 billion and $4.26 billion, respectively.

Among other positives, CCB average loan balances were up 1% year over year. Further, debit and credit card sales volume increased 8%. 

Also, mortgage fees and related income grew 43% to $376 million. We had projected the metric to be $396.9 million. Further, the company reported a fall in provision for credit losses in the quarter.

On the other hand, relatively lower interest rates and a fall in consumer loan (excluding credit cards) balance (down 4% year over year) hurt NII, while a decent growth in loan balance (up 2%) offered some support during the quarter. 

During the quarter, adjusted operating expenses witnessed a rise.

Revenues Jump, Expenses Rise

Net revenues, as reported, were $42.77 billion, up 11% year over year. The top line outpaced the Zacks Consensus Estimate of $40.96 billion.

NII fell 3% year over year to $23.35 billion. This was due to lower rates, a fall in deposit balances and deposit margin compression, partially offset by higher revolving balances in Card Services and the impact of the balance sheet mix. Our estimate for NII was $22.76 billion.

Non-interest income jumped 34% to $19.42 billion. Our estimate for non-interest income was $16.73 billion.

Non-interest expenses (on a managed basis) were $22.76 billion, down 7%. Excluding the $2.9 billion FDIC special assessment in the prior-year quarter, the metric was up 5%. This was mainly due to higher compensation expenses. We had projected non-interest expenses to be $22.99 billion.

The performance of JPMorgan’s business segments, in terms of net income generation, was decent. The Commercial & Investment Bank, Asset & Wealth Management and Corporate segments witnessed a rise in net income on a year-over-year basis. On the other hand, the Consumer & Community Banking segment incurred losses. Overall, net income jumped 50% to $14 billion. We had projected net income to be $11.19 billion.

Credit Quality: A Mixed Bag

Provision for credit losses was $2.63 billion, down 5% from the prior-year quarter. Our estimate for the metric was $2.47 billion.

Net charge-offs (NCOs) grew 9% to $2.36 billion. Also, as of Dec. 31, 2024, non-performing assets (NPAs) were $9.29 billion, jumping 22%.

Capital Position Solid

Tier 1 capital ratio (estimated) was 16.8% at the fourth-quarter end, up from 16.6% in the prior-year quarter level. Tier 1 common equity capital ratio (estimated) was 15.7%, up from 15%. Total capital ratio was 18.5% (estimated), stable year over year.

Book value per share was $116.07 as of Dec. 31, 2024, compared with $104.45 a year ago. Tangible book value per common share was $97.30 at the end of December 2024, up from $86.08.

Update on Share Repurchases

During the reported quarter, JPMorgan repurchased 18.5 million shares for $4.3 billion.

2025 Outlook

At the Bank of America Financial Services Conference on Feb. 11, JPMorgan’s chief operating officer, Jennifer Piepszak, provided a sneak peek into how the capital markets business is expected to perform in the first quarter of 2025.

Piepszak stated that IB fees in the first quarter will grow in the mid-teens range year over year. This is expected to be driven by “healthy” equity markets and debt issuances and the resurgence in IPOs. Further, mergers and acquisitions (M&As) “will take some time to play out” but the company is optimistic about the advisory business being a “tailwind” throughout the year.

Discussing markets revenues, Piepszak noted that momentum “has continued into the first quarter.” The metric is expected to be up in low double digits on a year-over-year basis.

Management expects NII to be approximately $94 billion compared with $93 billion reported in 2024. Notably, Markets NII of almost $4 billion is expected to majorly support the firm-wide NII growth.
 
Further, the company expects NII to trough by mid-2025 and grow thereafter. This is based on the assumptions of one interest rate cut and decent balance sheet growth.

Adjusted non-interest expenses are projected to be almost $95 billion.

Management expects average card loan growth to be healthy but below the 2024 level of 12%. Card NCO rates are now expected to be approximately 3.6%.

Further, it expects deposit growth to be modest across the franchise, with solid growth anticipated in the second half.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 6.16% due to these changes.

VGM Scores

At this time, JPMorgan Chase & Co. has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise JPMorgan Chase & Co. has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.