No stocks are bullet proof, except for Nvidia, but this company is really close.
JP Morgan is the king of the banks and they just reported stellar earnings. The CEO cannot stop bragging about how rosy the future looks.
I looked at a lot of potential plays this weekend but most companies have earnings over the next three weeks and that means their premiums are inflated. Once the majority of the earnings cycle passes those premiums will decline and we might also have the opportunity to buy some disappointment dips.
JPM - JP Morgan Chase - Company Description
JPMorgan Chase & Co. operates as a financial services company worldwide. It operates through Consumer & Community Banking, Corporate & Investment Bank, Commercial Banking, and Asset Management segments. The Consumer & Community Banking segment offers deposit and investment products and services to consumers; lending, deposit, and cash management and payment solutions to small businesses; residential mortgages and home equity loans; and credit cards, payment services, payment processing services, auto loans and leases, and student loans. The Corporate & Investment Bank segment provides investment banking products and services, including advising on corporate strategy and structure, capital-raising in equity and debt markets, as well as loan origination and syndication; treasury services, such as cash management and liquidity solutions; and cash securities and derivative instruments, risk management solutions, prime brokerage, and research services. It also offers securities services, including custody, fund accounting and administration, and securities lending products for asset managers, insurance companies, and public and private investment funds. The Commercial Banking segment offers financial solutions, including lending, treasury, investment banking, and asset management to corporations, municipalities, financial institutions, and nonprofit entities, as well as financing to real estate investors and owners. The Asset Management segment provides investment and wealth management services across various asset classes, such as equities, fixed income, alternatives, and money market funds; multi-asset investment management services; retirement services; and brokerage and banking services comprising trusts, estates, loans, mortgages, and deposits. JPMorgan Chase & Co. was founded in 1799 and is headquartered in New York, New York. Company description from FinViz.com.
I seriously doubt there are any readers who are not familiar with JP Morgan. The 218 year old bank has been around for many generations. They are widely seen as the strongest of the money center banks and they are only going to get stronger. The Fed is likely to raise rates three times in 2017 and every one of those hikes means free money to JPM and the other big banks.
JPM has put all the subprime mortgage suits and probes behind them and paid out billions to settle those problems. The Trump administration is expected to reduce regulation on banks and that will reduce expenses and open up new business opportunities. CEO Jamie Dimon was not a Trump fan before the election. Now he routinely speaks positive about the president and his expectations for the future of the economy.
JPM has already reported stellar earnings and lived through a strong bout of post earnings depression that knocked the stock back to $83. The rebound has been strong and it should breakout to a new nigh soon, market permitting.
Earnings April 14th.
Options are relatively cheap for LEAPS and we can give the stock plenty of leeway before stopping out. If you are afraid of future events you can add a March $82.50 put for 85 cents.
Buy Jan 2018 $90 Call, currently $5.80, initial stop loss $81.85.