| Stock (Symbol) | Stock Price | |
JP Morgan (JPM) |
$48 |
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| Data is as of | Expected to Report | Sector |
May 14, 2013 |
July 12 |
Financial |
| Sharek’s Take | ||
 As I mentioned in this month’s Growth Stock Newsletter, 2013 is the Year of the Safe Stock. One of the safest names is JP Morgan (JPM), which will be added to the Growth Portfolio and Aggressive Growth Portfolio today. JPM has quite a few things going for it. First the stock is very undervalued, and needs to go up 30% to get to where it should be. Second, it’s a safe stock, and safe stocks are in right now. Third, I feel the Financial stocks are ready to make a big move higher. Fourth, I don’t think we are taking a big risk getting into this stock, I feel the downside is limited. |
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| One-Year Chart | ||
 The big thing that stands out to me in the one-year chart is this stock has a P/E of only 9. Microsoft (MSFT) had a P/E of 9 earlier in the year and then the stock shot up until the P/E reached 12. I feel JPM has a move like that ahead for itself. The breakout point is $51 and JPM is currently $50. |
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| Earnings Table | ||
 Last quarter profit growth was a solid 21%, but revenue declined 3%. JPM isn’t really a growth stock, its a value stock, but the expected return with this holding is among the best of the stocks I follow.JPM has beaten the street solidly the past four quarters. Annual Profit Estimates have been increasing all year. Quarterly estimates don’t look great after next quarter. Again, this isn’t a growth stock. Still, I feel JPM is due to make a solid move higher. It’s just too cheap. |
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| Fair Value | ||
 If the company hits estimates and the stock’s P/E rises from 9 to 11 we will have a return of around 30%. JPM had an 11 P/E in 2006, 2007 & 2010. |
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| Ten-Year Chart | ||
 The ten-year chart is the most disappointing thing about JPM. The stock hasn’t done anything in a decade, and profit growth has been back-and-forth. Still, 2003’s profits were $3.24 and the company might make $5.67 this year. That’s a gain fo 75%. The stock should be higher too. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
7 of 17 |
JP Morgan isn’t a typical growth stock, but it possesses upside like one. This safe investment has upside of 30% and I feel financials are ready to make a move higher. Today I will buy JPM in the Growth Portfolio where it will rank 7th of 17 stocks in the Power Rankings. I think the upside is so good I will buy it for the Aggressive Growth Portfolio too, where it will rank 7th of 10 stocks. |
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Aggressive Growth Portfolio
7 of 10 |
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