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JPM expects 2026 NII of about $105.5 billion, supported by loan growth and a healthy pipeline.
Strong capital supports JPMorgan's $50 billion buyback and a 10% dividend increase to $1.65 per share.
Shares of JPMorgan (JPM - Free Report) are trading below their 50-day simple moving average (SMA), pointing to a deterioration in near-term technical momentum. A breach of this widely followed technical level can signal increased selling pressure and may make investors cautious about the stock’s immediate trajectory.
JPM Stock’s 50-Day Moving Average
Image Source: Zacks Investment Research
However, technical weakness alone does not necessarily indicate deterioration in the underlying business. For JPM, solid loan and deposit growth, a diversified revenue base, healthy capital levels and continued momentum across its businesses provide meaningful fundamental support. Investors should, therefore, assess whether the recent share price weakness reflects a temporary shift in sentiment or emerging pressure on the company’s earnings outlook.
JPM’s NII & Balance Sheet Trends Offer Support
Net interest income (NII) remains an important driver of JPMorgan’s earnings, particularly as the interest rate environment evolves. In the second quarter of 2026, NII excluding Markets increased 4% year over year to $23.7 billion. The company also continued to register balance sheet growth, with average loans rising 10% from the prior-year quarter to $1.5 trillion and average deposits increasing 7% to $2.7 trillion.
The improvement in loans indicates healthy demand across parts of JPMorgan’s franchise, while deposit growth reinforces the strength of its funding base. A large and diversified deposit franchise remains a competitive advantage because it gives the company greater flexibility in managing funding costs as interest rates change. Management expects 2026 NII of roughly $105.5 billion and NII excluding Markets of about $96.5 billion.
Nevertheless, the rate backdrop is a key driver of JPMorgan’s NII. The Federal Reserve’s 25-basis-point rate hike will lift yields on loans and other interest-earning assets, while a healthy loan pipeline supports earning-asset growth. Together, these factors are expected to bolster NII, although higher deposit and funding costs could absorb part of the benefit.
Capital Markets Add Another Earnings Lever for JPM
JPMorgan’s diversified business mix reduces its dependence on spread income alone. The company maintains significant operations across investment banking (IB), trading, payments, asset management and commercial banking, allowing strength in fee-generating businesses to partly offset potential pressure on NII.
In the second quarter, non-interest revenues jumped 47% year over year to $31.8 billion. The increase included a $4.6-billion net gain related to Visa shares, but underlying results were also supported by higher Markets revenues, IB fees and asset management fees.
This diversification remains particularly important if capital markets activity continues to improve. A healthier environment for mergers and acquisitions, debt and equity issuance and corporate financing will support IB revenues. JPMorgan’s leading position in global banking and markets leaves it well placed to benefit from increased client activity.
For the third quarter, management expects IB fees to rise in the mid-to-high teens year over year, supported by broad-based strength across products and geographies, and a robust deal pipeline. Markets revenues are also projected to increase in the mid-to-high teens, supported by broad-based strength across fixed income and equities.
Likewise, Citigroup’s (C - Free Report) third-quarter 2026 capital markets outlook appears upbeat. Markets revenues are anticipated to grow in the mid-single digits year over year, while IB revenues are likely to increase in the low-single-digit range. On the other hand, Bank of America’s (BAC - Free Report) third-quarter 2026 capital markets outlook points to a slowdown in fee-driven revenues after a strong first half. IB fees are projected to be $1.6-$1.8 billion, below $2 billion in third-quarter 2025. Further, sales and trading revenues are expected to be relatively flat year over year.
Credit Quality Manageable, But Normalization Bears Watching
Credit trends represent another important consideration for JPMorgan investors. In the second quarter of 2026, the company recorded $2.5 billion in credit costs, including $2.4 billion in net charge-offs (NCOs) and a $149-million reserve build. NCOs were roughly stable year over year, while the reserve addition was lower than in the prior-year period.
The total allowance for credit losses was $31.5 billion at the end of June. Non-performing assets totaled $9.8 billion, down 6% year over year. These trends suggest that credit conditions remain manageable despite continued normalization from exceptionally benign post-pandemic levels.
Yet, JPMorgan’s sizeable exposure to consumer credit, including cards, makes employment conditions, household finances and consumer spending important indicators to watch. A sharper economic slowdown could lead to higher delinquencies, NCOs and provisioning needs, thereby pressuring profitability.
JPM’s Strong Capital Position Supports Shareholder Returns
JPMorgan’s capital strength is another positive factor. As of June 30, 2026, the standardized CET1 ratio was 14.1% and the advanced ratio was 14.2%. Tangible book value per share increased 10% year over year to $113.35.
The company has also demonstrated confidence in its capital position through shareholder distributions. In June, JPMorgan authorized a new $50 billion share repurchase program effective July 1, 2026. Earlier this month, the board declared a quarterly dividend of $1.65 per share, up 10% from the prior payout. A strong capital buffer provides the company with flexibility to pursue organic growth initiatives, absorb potential credit losses and return excess capital to shareholders.
Similar to JPMorgan, Bank of America and Citigroup continue to demonstrate their commitment to enhancing shareholder returns through consistent dividend growth and share repurchases. Bank of America increased its quarterly dividend 14.3% to 32 cents per share in July. The company has also maintained an active capital return program, with $17 billion remaining under its $40-billion share repurchase authorization as of June 30, 2026.
Citigroup hiked its dividend 11.7% to 67 cents per share in July. The bank has also remained active in repurchasing shares. The board authorized a $30-billion buyback commitment in June 2026, with no expiry date. As of June 30, 2026, $26 billion worth of shares remained available.
JPMorgan’s Price, Valuation & Earnings Analysis
JPM stock has risen 4.2% so far this year, outperforming the industry’s growth of 2.7%. In the same time frame, Bank of America is at break-even, while Citigroup is up 12.3%.
YTD Price Performance
Image Source: Zacks Investment Research
Looking at JPMorgan’s valuation, the stock is currently trading at a 12-month trailing price-to-tangible book (P/TB) of 3.12X is above the industry’s 3.08X. This shows that JPM is trading at a slight premium relative to the industry average.
P/TB Ratio (TTM)
Image Source: Zacks Investment Research
Bank of America has a P/TB of 1.94X, while Citigroup’s P/TB is 1.33X. Thus, JPMorgan is expensive compared with BAC and C. JPMorgan has historically commanded a premium to many large-bank peers because of its superior profitability, diversified business mix and execution track record. Such a premium leaves the stock relatively sensitive to earnings disappointments or weaker-than-expected returns.
Near-term technical weakness, reflected in the stock’s move below its 50-day SMA, adds another element of caution. If the shares fail to reclaim this technical level, momentum-oriented investors could remain on the sidelines until signs of price stabilization emerge.
Analysts are optimistic regarding JPMorgan’s earnings potential. Over the past seven days, the Zacks Consensus Estimate for the company’s 2026 and 2027 earnings has been revised upward to $25.01 and 25.20, respectively. This suggests year-over-year earnings growth of 23% for 2026 and 0.8% for 2027.
Earnings Estimates
Image Source: Zacks Investment Research
How Should Investors Approach JPM Stock?
JPMorgan’s move below its 50-day SMA points to weaker near-term momentum, but the fundamental backdrop remains relatively firm. Loan and deposit growth, diversified fee revenues, manageable credit trends and a strong capital position continue to support earnings. Its scale across consumer banking, cards, IB, payments, trading and asset management also provides multiple revenue levers, while ongoing investments in technology and branch expansion could support longer-term market-share gains.
However, these investments are keeping expenses elevated, while credit normalization and the direction of NII remain key variables. Investors should also weigh these risks against the stock’s valuation and recent performance. Third-quarter results on Oct. 13 should provide greater visibility into NII, expenses, credit trends and capital markets activity.
Overall, the break below the 50-day SMA signals near-term caution rather than a fundamental shift in JPMorgan’s outlook. The company’s diversified franchise and capital strength provide support, but expense pressures, rate sensitivity and credit costs warrant a balanced stance at current levels.
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JPMorgan Trades Below 50-Day SMA: Buy, Sell or Hold the Stock?
Key Takeaways
Shares of JPMorgan (JPM - Free Report) are trading below their 50-day simple moving average (SMA), pointing to a deterioration in near-term technical momentum. A breach of this widely followed technical level can signal increased selling pressure and may make investors cautious about the stock’s immediate trajectory.
JPM Stock’s 50-Day Moving Average
Image Source: Zacks Investment Research
However, technical weakness alone does not necessarily indicate deterioration in the underlying business. For JPM, solid loan and deposit growth, a diversified revenue base, healthy capital levels and continued momentum across its businesses provide meaningful fundamental support. Investors should, therefore, assess whether the recent share price weakness reflects a temporary shift in sentiment or emerging pressure on the company’s earnings outlook.
JPM’s NII & Balance Sheet Trends Offer Support
Net interest income (NII) remains an important driver of JPMorgan’s earnings, particularly as the interest rate environment evolves. In the second quarter of 2026, NII excluding Markets increased 4% year over year to $23.7 billion. The company also continued to register balance sheet growth, with average loans rising 10% from the prior-year quarter to $1.5 trillion and average deposits increasing 7% to $2.7 trillion.
The improvement in loans indicates healthy demand across parts of JPMorgan’s franchise, while deposit growth reinforces the strength of its funding base. A large and diversified deposit franchise remains a competitive advantage because it gives the company greater flexibility in managing funding costs as interest rates change. Management expects 2026 NII of roughly $105.5 billion and NII excluding Markets of about $96.5 billion.
Nevertheless, the rate backdrop is a key driver of JPMorgan’s NII. The Federal Reserve’s 25-basis-point rate hike will lift yields on loans and other interest-earning assets, while a healthy loan pipeline supports earning-asset growth. Together, these factors are expected to bolster NII, although higher deposit and funding costs could absorb part of the benefit.
Capital Markets Add Another Earnings Lever for JPM
JPMorgan’s diversified business mix reduces its dependence on spread income alone. The company maintains significant operations across investment banking (IB), trading, payments, asset management and commercial banking, allowing strength in fee-generating businesses to partly offset potential pressure on NII.
In the second quarter, non-interest revenues jumped 47% year over year to $31.8 billion. The increase included a $4.6-billion net gain related to Visa shares, but underlying results were also supported by higher Markets revenues, IB fees and asset management fees.
This diversification remains particularly important if capital markets activity continues to improve. A healthier environment for mergers and acquisitions, debt and equity issuance and corporate financing will support IB revenues. JPMorgan’s leading position in global banking and markets leaves it well placed to benefit from increased client activity.
For the third quarter, management expects IB fees to rise in the mid-to-high teens year over year, supported by broad-based strength across products and geographies, and a robust deal pipeline. Markets revenues are also projected to increase in the mid-to-high teens, supported by broad-based strength across fixed income and equities.
Likewise, Citigroup’s (C - Free Report) third-quarter 2026 capital markets outlook appears upbeat. Markets revenues are anticipated to grow in the mid-single digits year over year, while IB revenues are likely to increase in the low-single-digit range. On the other hand, Bank of America’s (BAC - Free Report) third-quarter 2026 capital markets outlook points to a slowdown in fee-driven revenues after a strong first half. IB fees are projected to be $1.6-$1.8 billion, below $2 billion in third-quarter 2025. Further, sales and trading revenues are expected to be relatively flat year over year.
Credit Quality Manageable, But Normalization Bears Watching
Credit trends represent another important consideration for JPMorgan investors. In the second quarter of 2026, the company recorded $2.5 billion in credit costs, including $2.4 billion in net charge-offs (NCOs) and a $149-million reserve build. NCOs were roughly stable year over year, while the reserve addition was lower than in the prior-year period.
The total allowance for credit losses was $31.5 billion at the end of June. Non-performing assets totaled $9.8 billion, down 6% year over year. These trends suggest that credit conditions remain manageable despite continued normalization from exceptionally benign post-pandemic levels.
Yet, JPMorgan’s sizeable exposure to consumer credit, including cards, makes employment conditions, household finances and consumer spending important indicators to watch. A sharper economic slowdown could lead to higher delinquencies, NCOs and provisioning needs, thereby pressuring profitability.
JPM’s Strong Capital Position Supports Shareholder Returns
JPMorgan’s capital strength is another positive factor. As of June 30, 2026, the standardized CET1 ratio was 14.1% and the advanced ratio was 14.2%. Tangible book value per share increased 10% year over year to $113.35.
The company has also demonstrated confidence in its capital position through shareholder distributions. In June, JPMorgan authorized a new $50 billion share repurchase program effective July 1, 2026. Earlier this month, the board declared a quarterly dividend of $1.65 per share, up 10% from the prior payout. A strong capital buffer provides the company with flexibility to pursue organic growth initiatives, absorb potential credit losses and return excess capital to shareholders.
Similar to JPMorgan, Bank of America and Citigroup continue to demonstrate their commitment to enhancing shareholder returns through consistent dividend growth and share repurchases. Bank of America increased its quarterly dividend 14.3% to 32 cents per share in July. The company has also maintained an active capital return program, with $17 billion remaining under its $40-billion share repurchase authorization as of June 30, 2026.
Citigroup hiked its dividend 11.7% to 67 cents per share in July. The bank has also remained active in repurchasing shares. The board authorized a $30-billion buyback commitment in June 2026, with no expiry date. As of June 30, 2026, $26 billion worth of shares remained available.
JPMorgan’s Price, Valuation & Earnings Analysis
JPM stock has risen 4.2% so far this year, outperforming the industry’s growth of 2.7%. In the same time frame, Bank of America is at break-even, while Citigroup is up 12.3%.
YTD Price Performance
Image Source: Zacks Investment Research
Looking at JPMorgan’s valuation, the stock is currently trading at a 12-month trailing price-to-tangible book (P/TB) of 3.12X is above the industry’s 3.08X. This shows that JPM is trading at a slight premium relative to the industry average.
P/TB Ratio (TTM)
Image Source: Zacks Investment Research
Bank of America has a P/TB of 1.94X, while Citigroup’s P/TB is 1.33X. Thus, JPMorgan is expensive compared with BAC and C. JPMorgan has historically commanded a premium to many large-bank peers because of its superior profitability, diversified business mix and execution track record. Such a premium leaves the stock relatively sensitive to earnings disappointments or weaker-than-expected returns.
Near-term technical weakness, reflected in the stock’s move below its 50-day SMA, adds another element of caution. If the shares fail to reclaim this technical level, momentum-oriented investors could remain on the sidelines until signs of price stabilization emerge.
Analysts are optimistic regarding JPMorgan’s earnings potential. Over the past seven days, the Zacks Consensus Estimate for the company’s 2026 and 2027 earnings has been revised upward to $25.01 and 25.20, respectively. This suggests year-over-year earnings growth of 23% for 2026 and 0.8% for 2027.
Earnings Estimates
Image Source: Zacks Investment Research
How Should Investors Approach JPM Stock?
JPMorgan’s move below its 50-day SMA points to weaker near-term momentum, but the fundamental backdrop remains relatively firm. Loan and deposit growth, diversified fee revenues, manageable credit trends and a strong capital position continue to support earnings. Its scale across consumer banking, cards, IB, payments, trading and asset management also provides multiple revenue levers, while ongoing investments in technology and branch expansion could support longer-term market-share gains.
However, these investments are keeping expenses elevated, while credit normalization and the direction of NII remain key variables. Investors should also weigh these risks against the stock’s valuation and recent performance. Third-quarter results on Oct. 13 should provide greater visibility into NII, expenses, credit trends and capital markets activity.
Overall, the break below the 50-day SMA signals near-term caution rather than a fundamental shift in JPMorgan’s outlook. The company’s diversified franchise and capital strength provide support, but expense pressures, rate sensitivity and credit costs warrant a balanced stance at current levels.
At present, JPMorgan carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.