JPMorgan Chase & Co – Equity markets power a record quarter July 16, 2026 4

PSR Recommendation: ACCUMULATE Status: Maintained
Target Price: US380.00
  • 2Q26 adj. earnings rose 19% YoY to US$17bn, beating our estimates, with 1H26 adj. earnings at 53% of our FY26e forecast, driven by record markets revenue and strong IB fees. DPS rose 7% YoY to US$1.50. Dividend payout ratio dipped to 19% (2Q25: 27%), with net common stock repurchases in 2Q26 at US$6.2bn (2Q25: US$7.1bn).
  • NII rose 10% YoY on higher deposit and card balances despite NIM falling 3bps YoY to 2.40%. Non-interest revenue (+20% ex. significant items) was led by record markets revenue (+35%), IB fees (+30%) and asset management fees (+18%). FY26e NII guidance was raised to ~US$105.5bn (prev. US$103bn); expense guidance rose to ~US$107.5bn (prev. US$105bn).
  • Maintain ACCUMULATE with a higher target price of US$380 (prev. US$335) as we raise FY26e earnings by 10% from higher NII, principal transactions, asset management and investment banking estimates, and lower provisions estimates. Our GGM valuation assumes 3.02x FY26e P/BV and an ROE estimate of 23.6%. We like JPM for its best-in-class profitability (23% ROTCE), record earnings across every segment and fortress balance sheet. We see growth extending through 2H26: raised NII guidance (~US$105.5bn), an IB pipeline at its strongest since 2021, continued AUM inflows and improving card credit. A growing dividend and ~US$40bn of excess capital provide further support, giving shareholders multiple ways to be rewarded while earnings compound.

 

 

 

 

 

 

 

 

 

 

 

The Positives
+ CIB posts record Markets revenue; IB fees at five-year high. CIB net income surged 46%
YoY to US$9.7bn. Markets revenue hit a record US$12.1bn (+35% YoY), driven by Equity
Markets (+86%), while Fixed Income rose 6%. IB fees jumped 30% YoY (the highest since
2021), led by equity underwriting, with JPM #1 globally (9.3% YTD wallet share). AWM
revenue rose 19% YoY, with AUM up 18% YoY to US$5.1tn on US$50bn of long-term net
inflows. Firmwide non-interest revenue contribution rose to 56% of total revenue (2Q25:
48%).

+ NII resilient despite lower rates; credit quality improves. NII rose 10% YoY to US$25.6bn
as deposit, revolving card and wholesale loan growth offset lower rates. Average loans grew
10% YoY and deposits 7% YoY. CCB revenue grew 8% YoY to US$20.3bn, led by Card Services
& Auto (+12%). Provisions declined to US$2.5bn (2Q25: US$2.8bn), with NCOs slightly lower
YoY, while the Card NCO rate improved to 3.34% (1Q26: 3.47%).

The Negative

– Expense growth tracks revenue; FY26e cost guidance raised. Non-interest expense rose
15% YoY to US$27.3bn on higher revenue-related compensation, brokerage and distribution
fees, marketing and technology. FY26e adjusted expense guidance was raised to
~US$107.5bn (prev. ~US$105bn), primarily on volume and revenue-related costs, which is in
line with the revenue outperformance, but operating leverage is capped. NIM fell 3bps YoY
to 2.40% on lower rates.

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About the author

Profile photo of Glenn Thum

Glenn Thum
Research Analyst
PSR

Glenn covers the Banking and Finance sector. He has had 3 years of experience as a Credit Analyst in a Bank, where he prepared credit proposals by conducting consistent critical analysis on the business, market, country and financial information. Glenn graduated with a Bachelor of Business Management from the University of Queensland with a double major in International Business and Human Resources.

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