First Impression Of JPMorgan's 'Solid' Q3

Reviewing JPMorgan Chase & Co. (NYSE: JPM)'s third-quarter results, Buckingham Research said the solid quarter supported its above-consensus earnings per share estimate for 2018.

The firm reiterated its Neutral rating and $100 price target for shares of JPMorgan.

Nothing To Complain About

Analyst James Mitchell noted that the company reported third-quarter revenues roughly 2 percent above his forecast, expenses slightly below forecast and credit costs in line. The company's earnings per share of $1.76 exceeded the $1.66 estimate.

The analyst termed the overall results as a clean beat.

Among the positives the analyst highlighted were card business finally showing earnings power after years of heavy investment, solid consumer growth and net interest margin expansion and higher provisioning for growth.

Long-Term Market Share Winner

Buckingham Research expects the consensus estimates for 2018 to go higher and closer to its estimate, given the continued strength in consumer banking and an inflection point in the U.S. cards after years of investment.

"Despite the good news, considering its premium returns (15% ROTCE) and valuation (1.8x 2017E TBV), we simply see less ROTCE improvement (and thus upside) in JPM shares vs. BUY rated peers," the firm said.

However, the firm said it sees the company as a long-term market share winner.

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