UPDATE: Macquarie Upgrades JPMorgan Chase
In a note released Friday, Macquarie Equity Research upgraded JPMorgan Chase & Co. (NYSE: JPM) from Neutral to Outperform and raised the price target from $62 to $68.
In describing the justification for this upgraded Macquarie analyst David Konrad commented, "Large regional banks are trading north of 12x 2015E, equating to 84 percent of the S&P multiple, well above the historical relative multiple of 77 percent." Konrad continued," Lager domestic plays also appear rich," pointing to Bank of America Corp. (NYSE: BAC) and Wells Fargo & Co. (NYSE: WFC) as examples. Konrad concluded, "We believe JPM may benefit from a sector rotation as one of the cheapest ways to play this theme."
More specifically, Konrad pointed to buy backs, lower NCO expectations, and an improving business mix due to an increase in asset management (JPMorgan's best performing business) as main reasons for the upgrade.
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