JPM
JPMORGAN CHASE & CONYSEValuation snapshot
Above base casePrice is between the base and bull cases.
Price as of Aug 17, 2026 · Valuation Aug 12, 2026
What drives JPM's base case?
base-case thesisJPMorgan earned $57 billion in 2025 on $182.4 billion of revenue and has since accelerated, with revenue up 10% in the first quarter of 2026 and management raising its full-year lending-income forecast to about $105.5 billion. This case takes that guidance at face value for the first year or two, then lets growth settle back toward the mid-single digits as the interest-rate boost annualizes and fee income grows with the economy. Profitability stays near the 2025 level rather than the exceptional recent quarter, because management raised its expense plan by $2.5 billion and continues to describe a 17% return on tangible equity — below the 20% actually earned in 2025 — as the reasonable long-run figure. With a capital cushion well above requirements and a $31.6 billion buyback just completed, most of the profit keeps flowing back to shareholders rather than being retained.
What shapes the assumptions
Full-year 2026 lending income guided up to ~$105.5B from $95.4B in 2025
Net interest income
Raises revenue growth
Investment banking fees up 28% and record $11.6B Markets revenue in 1Q26
Noninterest (fee) revenue
Raises revenue growth
Adjusted expense plan raised $2.5B to ~$107.5B
Noninterest expense
Lowers operating margin
Management's 17% through-the-cycle return target versus 20% earned in 2025
Return on tangible common equity
Lowers operating margin
14.1% CET1 cushion and completed $31.6B buyback
Capital returned versus retained
Lowers reinvestment
Each driver links a business metric to the forecast assumption it shapes — the basis for this case, not investment advice.
Why the gap?
The market is pricing this as if revenue grows 7.0% a year. Over the last 5 years it grew 8.6% a year, so the price assumes about what it has delivered.
What else could explain it?›
- Or, holding growth steady
- the price is also consistent with a 42.4% operating margin, against the 38.0% assumed here.
- How confident is this estimate?
- Robustness 53.0/10 (Moderate) — some of any gap is our own uncertainty rather than disagreement.
- What would change the answer?
- Which assumption this valuation swings on, and by how much.
Many combinations of assumptions reproduce the same price. These are ways to read what the market might be expecting, not the market's actual view. How this is worked out
Research & assumptions
Inspect the valuation thesis, cases, risks, evidence, and model inputs.
View details
Research & assumptions
Inspect the valuation thesis, cases, risks, evidence, and model inputs.
Three independently researched cases generated automatically from published financials. Every assumption is justified and cited; the discount rate is computed from researched market inputs.
Base inputs from financials
source period →Base revenue (TTM)
$187B
Diluted shares
2,720,200,000
Net cash
—
Bear
medium confidence$207.01
IV / share
-42.9% vs $362.84
- Explicit cash flows
- $57.96
- Terminal value
- $149.06
- Net cash
- $0.00
- Intrinsic value / share
- $207.01
72.0% of the value rests on the terminal value — high dependency. A small change to terminal growth moves the valuation a lot — see terminal growth below.
bear revenue growth (avg 2%) runs well above the trailing -19% trend
Revenue growth2.5% → 1.0% → 1.0% → 2.0% → 2.5%medium
How derived: Starting from the fact that FY2025 net revenue grew only 3% to $182.4B and that 2Q26's headline +27% included a $4.6B Visa gain plus $1.0B of equity gains, this case assumes the 2026 capital-markets and trading surge is cyclical and fades, so growth decays toward roughly 1% as Fed cuts compress deposit spreads before a slow late-decade recovery to ~2.5%.
Why this confidence: Company-disclosed FY2025 revenue and NII trend anchors the low end ↑, Management explicitly quantified the one-time gains inflating 2Q26 ↑, Five-year path depends on an unknown Fed rate cycle ↓, Capital-markets revenue is inherently volatile and hard to forecast ↓
Evidence for
- FY2025 total net revenue rose only 3% to $182.4B, with NII excluding Markets flat versus the prior year — the underlying franchise was already decelerating before the 2026 trading surge.[JPMorganChase Full-Year 2025 Financial Results]· primary
- 2Q26 results included a $4.6B net gain on Visa shares and $1.0B of gains on certain equity investments, so the reported 27% managed-revenue jump overstates the recurring run-rate.[JPMorganChase 2Q26 Earnings Press Release]· primary
Evidence against
- 1Q26 net revenue rose 10% to $49.8B with investment banking fees up 28% and record Markets revenue of $11.6B, showing broad-based momentum beyond one-time items.[JPMorgan Chase 1Q 2026 Earnings]· secondary
- Management raised full-year 2026 total NII guidance to about $105.5B from $103B, citing higher deposit balances across wholesale and consumer plus higher rates.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
Operating margin33.0%medium
How derived: FY2025 delivered roughly a 39% pre-tax margin ($57.0B net income grossed up at a ~19.5% tax rate on $182.4B of revenue), and this case cuts that to 33% because management already lifted 2026 adjusted expenses by $2.5B to ~$107.5B while credit provisions normalize off a 1.83% allowance coverage ratio.
Why this confidence: Explicit management expense guidance for the forecast's first year ↑, Management's own 17% through-the-cycle ROTCE target supports margin normalization ↑, Provision expense in a downturn is highly uncertain ↓, Bank pre-tax margin is a derived, not directly disclosed, metric ↓
Evidence for
- Management raised full-year 2026 adjusted expense guidance to about $107.5B, up $2.5B from the prior view, as volume- and revenue-related costs rose.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
- Management continues to frame 17% ROTCE as its through-the-cycle expectation, well below the 20% delivered in 2025 and the 23% ex-notables in 2Q26 — an implicit admission that current profitability is above normal.[JPMorgan maintains 2026 expense outlook, ROTCE target at 17%]· primary
Evidence against
- 2Q26 ex-notables net income was $16.9B on a 23% ROTCE, showing the firm can absorb higher expense growth and still run above its long-run margin.[JPMorganChase 2Q26 Earnings Press Release]· primary
- The allowance-for-loan-losses coverage ratio fell to 1.83% at year-end 2025 from 1.87%, indicating credit was still improving rather than deteriorating.[JPMorganChase Full-Year 2025 Financial Results]· primary
Tax rate22.0%medium
How derived: JPM's trailing effective tax rate is about 19.5%, and this case moves it up to 22% because a lower-earnings mix reduces the relative benefit of tax-exempt municipal income and tax credits, and bank-specific levies remain a live policy risk.
Why this confidence: Long, stable multi-year history of reported effective rates ↑, Tax policy toward large banks is a political variable outside the company's control ↓, Single aggregator source for the most recent trailing rate ↓
Evidence for
- JPMorgan Chase's effective tax rate was reported at 19.46% as of March 2026, leaving room to drift up toward the 21% federal statutory rate plus state taxes if permanent-difference benefits shrink.[JPMorgan Chase Tax Rate]· secondary
Evidence against
- JPM's 10-K income tax disclosures show the firm has sustained an effective rate below the statutory rate for a decade via tax-exempt income and credits, arguing against a sharp step-up.[JPMorgan Chase FY2025 Form 10-K]· primary
Reinvestment rate20.0%medium
How derived: JPM's CET1 ratio slipped to 14.1% in 2Q26 as risk-weighted assets and distributions outpaced earnings, and this case assumes 20% of after-tax earnings must be retained to rebuild capital against higher RWA and tighter regulatory buffers, leaving less free cash for shareholders.
Why this confidence: CET1 ratio and RWA trend are disclosed quarterly ↑, Future regulatory capital requirements for G-SIBs remain unsettled ↓, Reinvestment rate for a bank is a modeling construct, not a reported line ↓
Evidence for
- The Standardized CET1 ratio fell 20 basis points to 14.1% in 2Q26 as net income was offset by higher risk-weighted assets and capital distributions.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
- 2026 guidance embeds roughly $105B of expenses driven substantially by technology investment, indicating a structurally high internal reinvestment burden.[JPMorganChase 2026 Company Update Transcript]· primary
Evidence against
- JPM completed a $31.61B buyback of 103,908,717 shares in early August 2026, evidence that capital generation still far exceeds what the balance sheet needs to retain.[JPMorgan Chase Stock Price History and Corporate Actions]· secondary
Terminal growth2.0%medium
How derived: With FY2025 revenue up just 3% and NII excluding Markets flat, this case sets long-run growth at 2% — roughly long-run inflation and below nominal GDP — on the view that a bank already holding ~10% of US deposits faces share-gain limits and secular fee-margin pressure.
Why this confidence: Anchored to disclosed core NII trend rather than a guess ↑, Perpetual growth assumptions are unverifiable by nature ↓, Set safely below the risk-free rate, limiting model blow-up risk ↑
Evidence for
- FY2025 NII excluding Markets was flat year over year, showing the core spread business is not growing faster than the economy.[JPMorganChase Full-Year 2025 Financial Results]· primary
Evidence against
- The 10-year Treasury yield stood at 4.68% on August 12, 2026, implying nominal growth expectations well above 2% and making a 2% perpetual rate conservative.[US 10-Year Treasury Yield]· secondary
Base
medium confidence$325.05
IV / share
-10.4% vs $362.84
- Explicit cash flows
- $77.95
- Terminal value
- $247.10
- Net cash
- $0.00
- Intrinsic value / share
- $325.05
76.0% of the value rests on the terminal value — high dependency. A small change to terminal growth moves the valuation a lot — see terminal growth below.
base revenue growth (avg 4%) runs well above the trailing -19% trend
Revenue growth5.5% → 4.5% → 4.0% → 4.0% → 3.8%high
How derived: Management guided full-year 2026 NII up to about $105.5B from $95.4B in 2025 and 1Q26 revenue grew 10%, so this case starts near 5.5% and decays toward ~4% as the NII step-up annualizes and fee growth settles to a mid-single-digit rate consistent with nominal GDP plus modest share gains.
Why this confidence: Explicit, recently raised management NII guidance for year one ↑, Two consecutive quarters of disclosed double-digit revenue growth ↑, Years three through five extend well beyond any guidance ↓
Evidence for
- Management raised full-year 2026 guidance to about $105.5B of total NII and ~$96.5B of NII ex-Markets, citing higher wholesale and consumer deposit balances and higher rates.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
- 1Q26 net revenue rose 10% to $49.8B, with net interest income up 9% and noninterest revenue up 11% on markets, asset management and investment banking fees.[JPMorgan Chase & Co. Earnings Release - First Quarter 2026]· primary
Evidence against
- FY2025 revenue grew only 3% and NII ex-Markets was flat, a reminder that the 2026 acceleration follows a notably weak comparison year.[JPMorganChase Full-Year 2025 Financial Results]· primary
- Quarterly revenue has been volatile — 2Q25 revenue fell 10.5% year over year — showing mid-single-digit growth is an average, not a floor.[JPMorganChase 2Q25 Financial Results]· primary
Operating margin38.0%high
How derived: FY2025's $57.0B of net income on $182.4B of revenue implies about a 39% pre-tax margin, and this case holds 38% because management's raised revenue and expense guidance roughly offset, while its stated 17% through-the-cycle ROTCE target signals gradual normalization from the current 20-23% returns.
Why this confidence: Anchored to a full audited fiscal year of reported revenue and net income ↑, Both revenue and expense guidance for the current year are public ↑, Provision for credit losses over five years is cycle-dependent ↓
Evidence for
- JPMorganChase reported FY2025 net income of $57.0B on total net revenue of $182.4B with a 20% ROTCE, establishing the recent margin baseline.[JPMorganChase Full-Year 2025 Financial Results]· primary
- 2Q26 ex-notables net income of $16.9B on a 23% ROTCE shows profitability running at or above the 2025 baseline in the current environment.[JPMorganChase 2Q26 Earnings Press Release]· primary
Evidence against
- Management raised full-year 2026 adjusted expenses by $2.5B to about $107.5B, a headwind to holding margins flat.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
- Management reiterates 17% as the through-the-cycle ROTCE it considers reasonable, below the 20% actually earned in 2025.[JPMorganChase 2026 Company Update Transcript]· primary
Tax rate20.0%high
How derived: JPM's trailing effective tax rate of about 19.5% reflects a durable structure of tax-exempt municipal income and credits below the 21% federal statutory rate, and this case rounds it to 20% to allow for a slightly higher state and foreign mix as international businesses grow.
Why this confidence: Multi-year reported effective rates are tightly clustered ↑, Assumption sits within one percentage point of the latest disclosed rate ↑, Corporate tax policy is subject to legislative change ↓
Evidence for
- JPMorgan Chase's effective tax rate was 19.46% as of March 2026, closely bracketing the 20% assumed here.[JPMorgan Chase Tax Rate]· secondary
- JPM's 10-K income tax footnote shows a decade of effective rates clustered in the high teens to low twenties.[JPMorgan Chase FY2025 Form 10-K]· primary
Evidence against
- Bank-specific levies and changes to the corporate rate remain recurring US policy proposals, so a decade of stability is not a guarantee of the next five years.[JPMorgan Chase FY2025 Form 10-K (Risk Factors)]· primary
Reinvestment rate16.0%medium
How derived: JPM carries a 14.1% CET1 ratio and just completed a $31.6B buyback, so only a minority of earnings is needed to fund balance-sheet growth; this case retains 16% of after-tax profit — roughly the ~4% asset growth implied by mid-single-digit revenue growth divided by a high-teens return on equity.
Why this confidence: Capital ratios and buyback size are directly disclosed ↑, Internally consistent with the growth and return assumptions in this case ↑, Future G-SIB capital rules could change required retention ↓
Evidence for
- JPMorgan Chase completed a $31.61B repurchase of 103,908,717 shares in early August 2026, demonstrating that most capital generated is returned rather than retained.[JPMorgan Chase Stock Price History and Corporate Actions]· secondary
- The Standardized CET1 ratio of 14.1% at 2Q26 sits comfortably above regulatory minimums, limiting mandatory retention.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
Evidence against
- CET1 fell 20 basis points in 2Q26 because higher risk-weighted assets and distributions outran net income, showing growth does consume capital.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
- 2026 guidance embeds roughly $105B of expenses driven substantially by technology investment, a form of reinvestment already inside the expense base.[JPMorganChase 2026 Company Update Transcript]· primary
Terminal growth3.0%high
How derived: FY2025 revenue grew 3% — close to long-run US nominal GDP — and this case adopts 3% as the perpetual rate, comfortably below the 4.68% 10-year Treasury yield, on the view that a diversified universal bank ultimately grows with the nominal economy it finances.
Why this confidence: Matches a disclosed full-year revenue growth rate ↑, Held below the observed risk-free rate ↑, Perpetual assumptions can never be directly verified ↓
Evidence for
- FY2025 total net revenue grew 3% to $182.4B, matching the perpetual rate assumed here.[JPMorganChase Full-Year 2025 Financial Results]· primary
- The 10-year Treasury yield of 4.68% on August 12, 2026 exceeds the assumed 3% perpetual rate, keeping the terminal value mathematically well behaved.[US 10-Year Treasury Yield]· secondary
Evidence against
- FY2025 NII excluding Markets was flat, suggesting the core spread franchise may grow slower than 3% in perpetuity.[JPMorganChase Full-Year 2025 Financial Results]· primary
Bull
low confidence$480.33
IV / share
+32.4% vs $362.84
- Explicit cash flows
- $99.04
- Terminal value
- $381.29
- Net cash
- $0.00
- Intrinsic value / share
- $480.33
79.4% of the value rests on the terminal value — high dependency. A small change to terminal growth moves the valuation a lot — see terminal growth below.
bull revenue growth (avg 7%) runs well above the trailing -19% trend
Revenue growth8.5% → 7.5% → 6.5% → 6.0% → 5.5%medium
How derived: 1Q26 revenue rose 10% and 2Q26 managed revenue rose 27% with every business line at a record, so this case assumes the capital-markets and payments franchise is structurally taking share and sustains high-single-digit growth that decays only gradually toward the mid-single digits.
Why this confidence: Two consecutive quarters of disclosed double-digit growth ↑, Company disclosed that a large share of 2Q26 growth was non-recurring ↓, Sustaining high-single-digit growth for five years exceeds any company guidance ↓
Evidence for
- 2Q26 total managed revenue rose 27% year over year to $58.0B, with every line of business posting record revenue.[JPMorganChase 2Q26 Earnings Press Release]· primary
- 1Q26 investment banking fees jumped 28% to $2.88B and Markets revenue hit a record $11.6B, evidence of share gains in capital markets.[JPMorgan Chase 1Q 2026 Earnings]· secondary
- Management raised full-year 2026 NII ex-Markets guidance to ~$96.5B, driven by deposit balance growth across wholesale and consumer.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
Evidence against
- The 27% 2Q26 revenue jump included a $4.6B Visa gain and $1.0B of equity gains that will not recur, so the sustainable growth rate is materially lower.[JPMorganChase 2Q26 Earnings Press Release]· primary
- FY2025 revenue grew only 3% and 2Q25 revenue fell 10.5% year over year, showing this franchise has recently gone through multi-quarter flat stretches.[JPMorganChase Full-Year 2025 Financial Results]· primary
Operating margin42.0%medium
How derived: Excluding one-time gains, 2Q26 still produced $16.9B of net income and a 23% ROTCE — above the 20% earned in 2025 — so this case assumes operating leverage holds as revenue outgrows the ~$107.5B expense plan, sustaining roughly a 42% pre-tax margin.
Why this confidence: Grounded in a company-published ex-notables profitability figure ↑, Directly contradicted by management's own 17% through-the-cycle target ↓, Assumes benign credit costs across a full five-year horizon ↓
Evidence for
- Excluding the Visa and equity gains, 2Q26 net income was $16.9B or $6.14 per share with a 23% return on tangible common equity.[JPMorganChase 2Q26 Earnings Press Release]· primary
- The 2Q26 expense increase was attributed mainly to volume- and revenue-related costs tied to stronger activity, i.e. variable costs that scale with revenue rather than fixed overhead.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
Evidence against
- Management states 17% ROTCE remains its reasonable through-the-cycle expectation, materially below the 23% ex-notables level assumed to persist here.[JPMorgan maintains 2026 expense outlook, ROTCE target at 17%]· primary
- FY2025 net income of $57.0B was down 2% year over year, showing profit can fall even as revenue grows.[JPMorganChase Full-Year 2025 Financial Results]· primary
Tax rate18.5%medium
How derived: JPM's trailing effective rate of about 19.5% already sits below the 21% federal statutory rate thanks to tax-exempt income and credits, and this case trims it to 18.5% on the assumption that a larger municipal and tax-advantaged investment portfolio grows alongside a bigger balance sheet.
Why this confidence: Anchored within one point of the disclosed trailing rate ↑, Assumes a further improvement with no specific management guidance behind it ↓, Tax policy toward large banks is politically exposed ↓
Evidence for
- JPM's effective tax rate of 19.46% as of March 2026 is already below the 21% federal statutory rate, showing durable structural tax benefits.[JPMorgan Chase Tax Rate]· secondary
Evidence against
- JPM's 10-K risk factors flag that changes in tax law and bank-specific levies could raise the firm's effective rate, making further reductions speculative.[JPMorgan Chase FY2025 Form 10-K]· primary
Reinvestment rate12.0%medium
How derived: With CET1 at 14.1% and a $31.6B buyback just completed against roughly $60B+ of annual earnings power, JPM is distributing the large majority of profit; this case retains only 12% because high returns on tangible equity let the firm fund growth internally while returning the rest.
Why this confidence: Buyback size and capital ratio are both publicly disclosed ↑, In tension with this case's high growth path, which requires more risk-weighted assets ↓, Depends on regulators continuing to permit large distributions ↓
Evidence for
- JPM completed a $31.61B repurchase covering 103,908,717 shares in early August 2026, reducing the diluted share count from the 2.72 billion base.[JPMorgan Chase Stock Price History and Corporate Actions]· secondary
- A 23% ex-notables ROTCE means each dollar retained supports far more asset growth than at a lower-return bank, lowering the retention needed for a given growth rate.[JPMorganChase 2Q26 Earnings Press Release]· primary
Evidence against
- CET1 declined 20 basis points to 14.1% in 2Q26 as risk-weighted asset growth and distributions exceeded net income, showing that faster growth does consume capital.[JPMorgan Chase Q2 2026 Earnings Call Transcript]· primary
Terminal growth3.8%low
How derived: The 4.68% 10-year Treasury yield implies market nominal growth expectations well above 3%, and with every JPM business line at record revenue in 2Q26 this case sets perpetual growth at 3.8% — above nominal GDP but still safely under the risk-free rate — reflecting durable share gains in payments and capital markets.
Why this confidence: Exceeds the company's most recent full-year revenue growth of 3% ↓, Perpetual growth for a firm already at ~10% of US deposits is hard to defend ↓, Still constrained below the observed risk-free rate ↑
Evidence for
- Every line of business posted record revenue in 2Q26, consistent with structural share gains rather than a single cyclical business running hot.[JPMorganChase 2Q26 Earnings Press Release]· primary
- The 10-year Treasury yield of 4.68% leaves ample headroom above a 3.8% perpetual growth rate.[US 10-Year Treasury Yield]· secondary
Evidence against
- FY2025 revenue grew only 3% and NII ex-Markets was flat, so a 3.8% perpetual rate exceeds JPM's most recent full-year performance.[JPMorganChase Full-Year 2025 Financial Results]· primary
Valuation robustness
reliability of the estimate, not a stock rating53 / 100 · Moderate
Formula v1.0.0. Higher means a more reliable estimate — not a recommendation.
Quality checks
Automated model-risk flags — warnings, not recommendations.
- 76% of the intrinsic value rests on the terminal value — a small change to terminal growth moves the valuation a lot.→ terminal growth
Per-share economics
Business growth after changes in the diluted share count.
| Period | Revenue growth | FCF/share | FCF/share growth | Shares | Share growth |
|---|---|---|---|---|---|
| Q2 2024 | 21.5% | — | — | 2.89B | -1.8% |
| Q3 2024 | 7.0% | — | — | 2.87B | -2.3% |
| Q1 2025 | 8.1% | — | — | 2.82B | -3.0% |
| Q2 2025 | -10.5% | — | — | 2.79B | -3.5% |
| Q3 2025 | 8.8% | — | — | 2.77B | -3.4% |
| Q1 2026 | 10.0% | — | — | 2.72B | -3.7% |
Valuation history every run
Why intrinsic value changed
Sequential deterministic bridge · order-dependent contributions · exactly reconciled
Market inputs researched
The 10-year US Treasury note yielded 4.68% on August 12, 2026, and this default-free long-duration rate is used directly as the risk-free rate for a US-dollar cash-flow discount.
Published 5-year betas for JPM cluster at 0.98-1.00, and this case adopts 1.00 because a diversified universal bank with both rate-sensitive lending and cyclical capital-markets revenue tracks broad market risk closely.
Damodaran's forward-looking implied ERP backed out of S&P 500 prices and expected cash flows was 4.23% over the US Treasury bond rate at the start of 2026, and that market-implied figure is used unadjusted.
JPM traded at $362.61 on August 12, 2026 within a $361.30-$363.61 daily range, and the last trade is used as the market price against which the modeled value is compared.
Generated 8/12/2026, 3:00:12 PM · pipeline v1.1.0