JPMorgan Chase to Buy Back Nearly $20 Billion Worth of Stock
Shares of the nation’s biggest bank are up on news that it plans to buy back a massive amount of stock over the next 12 months. It wasn’t a surprise Wednesday when JPMorgan Chase (NYSE:JPM) announced it has increased the size of its share buyback authorization. What was a surprise, however, was the amount of the increase.
After passing both rounds of this year’s stress tests, the nation’s biggest bank by assets said its board has cleared a $19.4 billion addition to its common stock repurchase plan. That’s nearly double the amount that JPMorgan Chase’s board approved last year. It also exceeds the size of similar plans at other major banks.
JPMorgan Is Low Risk — Here Comes the Rally
JPMorgan (JPM) has been moving up well. The stock has now eclipsed both the May and April highs. This breakout-type move is leaving behind layers of support and has set up the stock well for a rally back up to the 2017 peak. Investors should view shares as a low-risk buy on weakness in the near term.
Immediately after reaching new 2017 lows on May 31, JPMorgan began a steady rebound. After a string of seven straight gains in early June, the stock had returned to a heavy resistance zone near the $88.00 area. This key zone has held a number of weekly and monthly highs since the very damaging March 21 breakdown.
Shares stalled here once again and have been tracing out a narrow consolidation pattern since. Following Wednesday’s impressive move, JPMorgan has resolved this healthy action with an upside breakout and is set up well for more upside.
J.P. Morgan: $100, Here We Come?
J.P. Morgan & Chase (JPM) plans $19.4 billion in buybacks over the next year as part of the capital plan approved by the Federal Reserve last night as part of its annual stress test. The bank also plans to hike its quarterly dividend to 56 cents a share in the soon to start third quarter.
Arguing that more buybacks mean more EPS, Credit Suisse analyst Susan Roth Katzke and her team upped their price target for J.P. Morgan from $99 to $102 a share. That suggests an 11% upside for a stock that has already climbed 49% in the past year.
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On the Tape Today | 6-30-17
LLY-Lilly hit support yesterday for the recent order flow. Game planning a new swing trade long with a limit order to buy @ $82.50. Target to sell comes in just below the resistance level at $85.75. Stop loss for the trade on a close below $81.50.
The stock market is driving active traders crazy… The daily flip-flop is exhausting.
Investors though, are in heaven. The only question is… How much longer can the stock market climb without a reasonable decline?
Although the long-term order flow remains bullish, we are starting to see the SPY ETF close below the open price with frequency.
Are we starting to see the first signs of a top? Tough call, not smart to get aggressive against this trend… but it sure looks different.
Stocks to Trade | 6-30-17 Friday Edition
Bullish Momentum: CBI, LULU, EXEL
Bearish Momentum: khc, ma, adsk, amat, cc, mchp, stx, dish, shop, lrcx, incy, jd
Bullish Order Flow: C, EXEL, JPM, DXC, PSX, AET, UNH, UPS, LLY, MCD, AMGN, RH, CAH, BA, TSO, CELG, BABA, CARA
Bearish Order Flow: stx, khc, qcom, trgp, rost, rspp, tjx, dltr, hds, tsco, slb, bby, hal, apc, clr, dvn
Double Normal Volume: C, CRZO, CBI, WBA, NFX, COF, OKE, KHC
Inside Day: cbi, kbh, adp, syy, celg, dis, aal, rost, trip, momo, kmx
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