Citibank: J.P. Morgan Chase (JPM.US)'s 2025 Q4 earnings report can be expected to be stable, but its relative valuation appeal is limited

The Zhitong Finance App learned that Citibank released a research report saying that although J.P. Morgan Chase (JPM.US)'s spending guidance of US$105 billion in 2026 exceeded the market's previous general expectations of about US$1010-102 billion, benefiting from a favorable revenue environment, J.P. Morgan Chase's results for the fourth quarter of 2025 and the full year of 2026 are still expected to achieve steady growth. However, the bank added that the current valuation of 3 times the tangible book value already reflects its industry-leading performance and has limited relative valuation appeal, so it maintains J.P. Morgan's “neutral” rating, and the target price is $325.

A team of analysts led by Keith Horowitz pointed out in the report that J.P. Morgan Chase's high spending expectations in 2026 are not due to insufficient investment, but are based on two factors: first, fee revenue is expected to grow strongly enough to cover related expenses; second, the company tends to prioritize long-term investment when discovering market opportunities.

Although Citi raised its own forecast in response to higher spending guidelines, the overall profit forecast remained largely unchanged due to the belief that previous estimates of fee revenue may have been too conservative. The bank anticipates that as the market gradually digests this spending guide, industry consensus expectations may be lowered, thus creating more relaxed conditions for J.P. Morgan Chase to meet subsequent performance standards. According to information, J.P. Morgan Chase plans to release financial results for the fourth quarter of 2025 on January 13.

In terms of performance expectations, Citi predicts that J.P. Morgan Chase's adjusted earnings per share in 2026 will be 21.10 US dollars, which will further increase to 22.95 US dollars in 2027; net interest income is expected to reach 101.908 billion US dollars in 2026, expenses and commission income will reach 93.995 billion US dollars, and total operating profit is expected to reach 19.903 billion US dollars. Citi also anticipates that J.P. Morgan Chase will keep its net interest income and expense guidelines unchanged throughout the year.

Citi said that growth is mainly driven by corporate and investment banking. It is expected that banking business and transaction revenue will maintain a strong momentum in 2026, and J.P. Morgan Chase will fully benefit from this favorable environment due to its market position. Furthermore, the company's loan and deposit business is expected to achieve 3%-4% year-on-year growth. By the end of 2026, the cumulative interest rate beta value will be about 54%, which is slightly lower than the beta level during the interest rate hike cycle.