CA - JPMorgan Chase: Not Worth The Recession Risk (Rating Downgrade)

2024-02-01 01:38:49 ET

Summary

• JPMorgan Chase has outlined strong shareholder performance since late 2022, but the high odds of a recession in 2024 suggest oversized loan default risk is approaching.
• The pattern of cash yield fluctuations for equities, including JPMorgan vs. 1-year Treasury rates starting in October has predated recessions by roughly 6-9 months since 2000.
• Valuations for JPMorgan resemble the 2000, 2008, and 2020 periods right before recession.
• Insider sales and waning momentum in the stock rally are additional concerns, leading me to downgrade my rating to Sell.

I was super-bullish on JPMorgan Chase ( JPM ) in September 2022 here . Since then, the nation's largest bank has been an industry leader for shareholder performance out of the U.S. money center financials. Had you followed my suggestion, a total return gain of +73% has more than doubled the equivalent-period S&P 500 worth advance of +34%, without owning any direct Big Tech exposure....

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