Financials

Bank of America Could Face Limited Upside If or Not Fed Cuts Rate, UBS Says

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Bank of America (BAC) could have limited upside given a combination of macroeconomic factors, UBS Securities said in a note emailed Thursday. UBS considers the bank’s stock to be at fair value following adjustments to account for three Federal Reserve rate cuts in 2024 and four cuts in 2025. The company has a positive momentum going with strong deposit growth, increase in investment banking and markets activity, and potential buybacks, especially in the second half. With Bank of America’s stock in the high $30s, trading at 12x its estimated 2024 EPS and 11.5x its estimated 2025 EPS, and $4 EPS unlikely until 2026, assuming there’s no recession, “this is now fairly reflected in market multiples,” UBS said. However, the conundrum is that if the Fed cuts rates, the bank will have to lower EPS estimates, and if the Fed keeps rates high, Bank of America could make more money, but […]

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JPMorgan Launches New Product to Connect Marketers With Its Cardmembers for Targeted Deals

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By Steve Gelsi Megabank rolls out ‘the only bank-led media platform of its kind’ to help target brand promotions JPMorgan Chase & Co is adding one more line of business to its diversified portfolio. The bank (JPM) said Wednesday its launching Chase Media Solutions to connect marketers with its 80 million customer to offer discounts and other offers based on their historic spending patterns. The moves comes after a pilot program with Whataburger, Solo Stove, Blue Bottle and Air Canada. Scott O’Leary, who is vice president of loyalty and product for Air Canada, said in a prepared statement that Chase, “succeeded in creating a thoughtful, targeted offer that exceeded our expectations” with a program that generated incremental revenue for Air Canada among Chase’s cardmembers. The bank already offered customers deals through its Chase Offers program, which will now include offers from Chase Media. The bank did not provide any revenue

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Wells Fargo, JPMorgan Named Top Picks by Goldman Sachs for Potential First-quarter Upside Surprise

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By Steve Gelsi Analysts see Wells Fargo and JPMorgan Chase potentially outshining Morgan Stanley, Citi, PNC, U.S. Bancorp and Bank of America JPMorgan Chase & Co. and Wells Fargo & Co. both ranked as top picks on Tuesday among the seven large-bank stocks covered by Goldman Sachs analysts. Goldman Sachs analysts led by analyst Richard Ramsden said JPMorgan Chase (JPM) and Wells Fargo (WFC) have provided “conservative” guidance on their net interest income, which is the profit banks make from loans after they pay out interest for their deposits. The banks are outshining Morgan Stanley (MS), Bank of America Corp. (BAC), U.S. Bancorp (USB), Citigroup Inc. (C) and PNC Financial Services Group Inc. (PNC), which are also tracked by Goldman Sachs. Goldman lifted its price target for Wells Fargo to $65 a share from $57 and hiked its JPMorgan Chase price target to $229 from $215. On average, Goldman hiked

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CFRA Maintains Buy Opinion On Shares Of Jefferies Financial Group, Inc.

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CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: Despite earnings miss, we believe overall results were positive and showcased an emerging recovery within the sector. We raise our target by $5 to $52, on a forward P/E of 14.0x our FY 24 (Nov.) EPS estimate, a slight discount to JEFs five-year average multiple (14.8x) due to risks of recession or fewer-than-expected rate cuts weighing on the recovery of capital markets. We lift our FY 24 EPS estimate by $0.32 to $3.70 and FY 25’s by $0.27 to $4.63. JEF posted FQ1 adjusted EPS of $0.68 vs. $0.55, a $0.08 consensus miss, although impacted by an $0.18 loss taken on an investment. Net revenues jumped 35% Y/Y, driven by a 31% Y/Y increase within Investment Banking that was led by a 65% Y/Y increase in Underwriting

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S&P Global Ratings Sees Growth and Innovation Post-IHS Markit Merger: BofA Securities Information and Business Services Conference Summary

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Two years following the landmark merger between S&P Global Inc. and IHS Markit, Martina Cheung, President of S&P Global Ratings, reflects on the integration’s success and future opportunities at the BofA Securities Information and Business Services Conference. The merger has yielded significant cost savings through reduced shared services and renegotiated third-party licenses. More importantly, it has enhanced the Ratings division’s access to high-value data, such as Mobility, Commodity Insights, and fixed income data from Market Intelligence. This integration has not only streamlined internal processes but also bolstered the division’s research capabilities, a cornerstone of S&P’s value proposition to investors. Cheung highlighted the synergy between IHS Markit’s products and S&P’s credit ratings, which has led to increased referrals across S&P Global’s divisions. As the President of Ratings, Cheung’s priorities align with the company’s strategic pillars discussed during Investor Day, focusing on expanding the core Ratings business, enhancing non-transaction services, and addressing

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AI Will Drive Big Demand for Copper, J.P. Morgan Says. 3 Stocks to Watch. — Barrons.com

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By Tae Kim Surging demand for artificial intelligence might exacerbate a copper shortage later this decade, J.P. Morgan warns. Copper is an essential component for power infrastructure upgrades based upon its electrical conductivity, use in wires, and relative low cost. Data centers will need to revamp their power and cooling systems as AI servers draw more power per square foot. Incremental demand from AI is “stressing an already large looking annual copper supply shortfall later this decade,” J.P. Morgan analyst Dominic O’Kane wrote Thursday. “The implications for future copper demand are significant.” Using the International Energy Agency’s base case scenario of 15% annual power growth for data centers, O’Kane estimates AI will lead to 2.6 million tonnes of additional aggregate copper demand by 2030. Even without the advent of AI power demand, J.P. Morgan had forecast 4 million tonnes cumulative supply shortage through 2030. “Our analysis suggests that data center

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Jefferies Announces First Quarter 2024 Financial Results

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Jefferies Announces First Quarter 2024 Financial Results NEW YORK–(BUSINESS WIRE)–March 27, 2024– Jefferies Financial Group Inc. (NYSE: JEF) Q1 Financial Highlights — Net earnings attributable to common shareholders of $150 million, or $0.66 per diluted common share, and net earnings attributable to common shareholders from continuing operations of $157 million, or $0.69 per diluted common share. Adjusting our results this quarter for a pre-tax loss of $55 million associated with our investment in Weiss Multi-Strategy Advisers, which recently announced it is closing down, our net earnings attributable to common shareholders from continuing operations was $196 million16, or $0.8716 per diluted common share. Of the pre-tax loss to us of $55 million, $30 million reduced our Asset Management net revenues and $25 million increased our non-compensation expenses. — Annualized return on adjusted tangible total equity from continuing operations1 of 9.8%. Adjusting for the impact of the loss on Weiss, our annualized

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