I am currently long on JP Morgan Chase & Co. ( Symbol JPM ). You might be taken back by that statement with all of the recent bad press related to large losses from bad investments, but does anyone even look at fundamentals anymore? JP Morgan is making hand over fist money and has a P/E of about 7.5!
Absolutely insane that this stock has performed so poorly, regardless of the bad media. In fact, despite the investment loss, JP Morgan is still expected to report a giant gain for the second quarter (most likely over $3 billion). Furthermore, the last 4 years of performance (before taxes): +$26.74B, +24.85B, +16.06B, +2.77B. That is $70 billion dollars (before tax) from 2008 until the end of 2011. Market Cap of JPM, only $129.58 billion.
Now of course you have to decide which factors and heavily you weight those factors when deciding on investment decisions (disclaimer: consult a professional), but how much sweeter does this stock get?
- P/E of 7.5
- Making money hand over fist, even AFTER massive mistakes
- Has a dividend
- Market Cap is drastically undervalued compared to 4 year performance (in my opinion)
- Heavily institutionally owned stock (74%).
- Has flirted with the $40+ range numerous times within the last 2.5 years. Note: $40 would be a +17.5% gain from today’s closing price.
If you are looking for a long-term stock, I think JP Morgan and Co. ( Symbol JPM ) should probably be in the running for a portion of your portfolio. Honestly I wouldn’t be surprised if this stock hit $45-50 by the end of 2012.