JPMorgan: Start Accumulating The Preferred For Income, Hold The Common At 3.2x Book

The Alpha Analyst 5.16K Followers Follow Summary JPMorgan is operating at near peak conditions, with Q2 ROTCE at ~23% and record Markets and Investment Banking revenue. JPM's valuation is historically elevated at ~3.2x tangible book and ~14.8x forward PE, making the common stock a Hold due to multiple compression risk. Preferred shares (JPM.PR.M, JPM.PR.K, JPM.PR.J, JPM.PR.L) offer ~6.4% yields and discounted entry, but rate risk limits immediate upside. I favor starter positions in preferreds for income, as common shares face multidimensional risks and limited upside at current valuations. danielvfung/iStock Editorial via Getty Images JPMorgan ( JPM ) is running at near peak conditions. Q2 numbers confirm solid performance. The ROTCE is still strong at ~23% even after stripping out one-off gains, still up from ~21% a year ago, on record Markets and Investment Banking This article was written by The Alpha Analyst 5.16K Followers Follow I am a stock analyst with over 20 years of experience in quantitative research, financial modeling, and risk management. My focus is on equity valuation, market trends, and portfolio optimization to uncover high-growth investment opportunities. As a former Vice President at Barclays, I led teams in model validation, stress testing, and regulatory finance, developing a deep expertise in both fundamental and technical analysis. Alongside my research partner (also my wife), I co-author investment research, combining our complementary strengths to deliver high-quality, data-driven insights. Our approach blends rigorous risk management with a long-term perspective on value creation. We have a particular interest in macroeconomic trends, corporate earnings, and financial statement analysis, aiming to provide actionable ideas for investors seeking to outperform the market. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.