Pros, Cons to Buying JPMorgan Stock

JPMorgan Chase & Co. (NYSE: JPM) bills itself as one of the oldest money management firms in the U.S., dating back more than 200 years. Today, the financial behemoth boasts total assets of $2.6 trillion – that’s almost equivalent to the total gross domestic product of India in 2017, the sixth-largest economy in the world. With 250,000 employees and offices in more than 100 global markets, JPMorgan certainly fits the bill as a global investment banking powerhouse. But is it a portfolio powerhouse for investors looking to make an asset killing of their own in the banking sector? Certainly, the pedigree is there for JPMorgan Chase, but investors want to see some profit potential for JPM stock, too. As 2018 draws to a close, the outlook on that front seems to be a positive one, but not without risks. JPMorgan Chase stock is trading near $110, with a one-year consensus target rate of $122 per share. JPM's market cap is $366 billion and the stock's dividend payout is a fairly ample 2.9 percent. Investment experts say that the banking and finance sector is in something of a sweet spot, as economic trends are shifting in the right direction for banking and finance stocks. “I like the financial sector at this moment,” says Glen D. Smith, managing partner for Glen D. Smith & Associates in Flower Mound, Texas. “We expect rates to continue to climb. And as rates go up, financials should profit more as the spread between what the banks generate on short-term notes and what they pay out to the customer continues to widen. “Smith says JPMorgan is a best-of-breed bank stock, as the U.S. economy and consumer sentiment continue to trend upward.“(JP Morgan CEO) Jamie Dimon recently said on a public conference call that wages are going up, participation is going up, the credit that has been written is pristine and housing is in short supply,” he says. “The confidence of both small businesses and consumers is extraordinarily high, which could drive a lot of growth for a while in spite of the headwinds out there.”