A Board Member Bought Shares of JPMorgan Chase

Page 1 of 2

According to a filing with the SEC, Timothy Flynn, a member of the Board of Directors at JPMorgan Chase & Co. (NYSE:JPM), directly purchased about 6,800 shares of the bank’s stock on January 29th at an average price of $46.93 per share. This roughly $320,000 investment brought Flynn’s total holdings of JPM to almost 15,000 shares. We track insider purchases because they tend to be bullish signals, though average outperformance of the market is very slight when only one insider is buying the stock (read more about studies on insider trading). Interestingly, earlier in January we had reported on an insider purchase at Bank of America Corp (NYSE:BAC). See our coverage of an insider purchase at Bank of America. We’d wonder if these buys might be interpreted as more general optimism on the large banks.

In the fourth quarter of 2012, JPMorgan Chase & co. experienced double-digit growth rates of both revenue and net income versus a year earlier. In fact, revenue was up almost 20% while earnings surged over 50%. While these growth rates are of course not sustainable, they suggest that JPMorgan Chase’s business is performing well in the current financial environment. In fact, given the current stock price, the bank does not really need to deliver any further improvements in order to be a good value: the trailing P/E multiple is only 9. With the rise in its stock price (up 25% in the last year, despite the London Whale fiasco), JPMorgan Chase’s discount to book value has narrowed and the current P/B ratio is 0.9. As a result JPMorgan Chase & Co. appears to be a good value and we can see why an insider would be buying the stock.

Ken Fisher FISHER ASSET MANAGEMENT

JPMorgan Chase, along with Bank of America, Citigroup Inc. (NYSE:C), and Wells Fargo & Company (NYSE:WFC) was one of the most popular stocks among hedge funds in the third quarter of 2012 (see the full top ten list). Billionaire Ken Fisher’s Fisher Asset Management more than doubled the size of its position during the quarter and closed September with over 13 million shares in its portfolio (check out Fisher’s stock picks). AQR Capital Management, which is managed by Cliff Asness, reported a position of 4.2 million shares in its own 13F filing (find Asness’s favorite stocks).

How does JPMorgan Chase compare to these peers as a value investment?

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!