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James Li
James Li
Articles (1097)  | Author's Website |

Berkshire Bank Holding JPMorgan Rises on Strong 2019 Revenue Growth

Bank reports strong investment banking fees for the 11th consecutive year

January 14, 2020 | About:

Shares of JPMorgan Chase & Co. (NYSE:JPM), a major bank holding of Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway Inc. (NYSE:BRK.A)(NYSE:BRK.B), rose over 2% in morning trading on Tuesday on the heels of strong revenue and net income growth during fourth-quarter 2019.

The New York-based bank reported net income of $8.52 billion, or $2.57 per share, compared with net income of $7.07 billion, or $1.98 per share, during fourth-quarter 2018. Revenue of $28.3 billion exceeded the Refinitiv estimate of $27.94 billion.


Company continues setting strong revenue momentum

JPMorgan CEO Jamie Dimon said the bank achieved “record revenue and net income” during the final three months of 2019 as the U.S. consumer “continues to be in a strong position” despite geopolitical issues like the ongoing U.S.–China trade war and macroeconomic events. While consumer and community banking average loans declined 6%, average deposits increased 5% and credit card sales grew 10% on the heels of a robust holiday season.

Corporate and investment bank revenue of $9.5 billion increased 31% year over year, with strong growth in both investing banking revenue and market revenue. Dimon said JPMorgan’s global investment banking fees reached a 9% wallet share for 2019, resulting in a number one rank for the 11th consecutive year. Chief Financial Officer Jennifer Piepszak added during the earnings call that net underwriting fees continued its strong momentum as clients accelerate funds and “take advantage of pricings to strengthen balance sheets.”

Stock rises on revenue beat

Shares of JPMorgan reached an intraday high of $140.76, up approximately 2.59% from Monday’s close of $137.20. The stock helped the Dow Jones Industrial Average inch closer to 29,000.


According to GuruFocus, JPMorgan’s net margin of 30.84% and return on equity of 12.74% outperform approximately 68% and 77.5% of global banks.


See also

Berkshire has not released its fourth-quarter portfolio report as the deadline is 45 days after the quarter ends. As of the September quarter, Berkshire owns 59,514,932 shares of JPMorgan, dedicating 3.26% of the equity portfolio to the stake.


Berkshire’s other top bank holdings include Bank of America Corp. (NYSE:BAC), Wells Fargo & Co. (NYSE:WFC) and U.S. Bancorp (NYSE:USB).

Other gurus with holdings in JPMorgan include PRIMECAP Management (Trades, Portfolio) and Dodge & Cox.


Disclosure: No positions.

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About the author:

James Li
I am an editorial researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

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