A Bet On The Smartest Bankers In The Business: Goldman Sachs Group, Inc. (GS), JPMorgan Chase & Co. (JPM)

JPMorgan Chase & Co. (NYSE:JPM) is several times larger than Goldman, with $2.4 trillion in assets under management. In addition to investment banking, the company offers consumer and business banking, credit card services and more. I believe that JPMorgan was the savviest financial firm during the financial crisis, picking up Washington Mutual and Bear Stearns, along with their accompanying market share, for a fraction of their value. I’ve written more extensively about the merits of JPMorgan as an investment, however suffice it to say that I have the highest level of regard for the company. JPMorgan Chase & Co. (NYSE:JPM) currently trades at a very attractive 9.6 times earnings, however the company’s projected forward growth rate is not as high as Goldman’s.

Final thoughts…

Again, to reiterate what Warren Buffett said when he made a huge investment in Goldman Sachs Group, Inc. (NYSE:GS) in the wake of the financial crisis, the company truly has the most talent of any investment bank. Goldman certainly knows the value of retaining talent, and is willing to pay well for it. In fact, compensation expenses in 2012 were 40% of net revenue! Goldman Sachs is truly a bet on brains, and it’s a bet that I’m definitely willing to make.

The article A Bet On The Smartest Bankers In The Business originally appeared on Fool.com and is written by Matthew Frankel.

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