According to The New York Times, JPMorgan CEO and Chairman Jamie Dimon bought $26 million worth of JPMorgan’s stock on Thursday following a near 20 percent drop since the start of 2016. The bank’s stock fell 33% for the year through Thursday’s close of $15.51.
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Barron’s Teresa Rivas thinks JPM shares still look cheap below , and just 8.4x next year’s earnings and 0.9x book value, given that the bank is still expected to eke out earnings growth this year and return to high-single-digit Y/Y EPS growth in 2017 and beyond.
Other global banks including Citigroup, Bank of America, Credit Suisse Group and Deutsche Bank have all plunged more than 32 per cent.
Shares of JPMorgan Chase have jumped 7.2% to $56.91 at 1:21 p.m. today, what would be its largest one day-gain since November 2011.
The $26 million purchase is created to stem the tide of negative sentiment overwhelming bank stocks this year.
A total of 699 officers and directors of USA companies purchased their own stock in the past 30 days compared with 828 who sold, the most bullish ratio in more than four years, according to data.
Mr Dimon’s total compensation for past year was US$27 million, mostly in stock units linked to the bank’s future performance.
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The bank’s shares rose 1.4 per cent in after-hours trading, after the purchase was first reported. According to Bloomberg, that was a 35% raise from a year earlier, as profit reached a mammoth record of $24.4bn.
