3. JPMorgan Chase & Co. (NYSE:JPM)
GQG Partners’ Stake Value: $806 million
Percentage of GQG Partners’ 13F Portfolio: 2%
Number of Hedge Fund Holders: 111
JPMorgan Chase & Co. (NYSE:JPM) is one of the world’s largest and oldest banks. It is headquartered in New York, New York United States, and was founded in 1799, soon after the American revolution. The bank offers several kinds of services in its portfolio. These include consumer, corporate, and commercial banking services alongside asset and wealth management.
By the end of last year’s fourth and final quarter, Mr. Jain’s investment firm had owned 5 million JPMorgan Chase & Co. (NYSE:JPM) shares which were worth $806 million and represented 2% of its investment portfolio. Insider Monkey’s survey of 924 hedge funds for the same time period revealed that 111 had held stakes in the bank.
In its latest fiscal fourth quarter, JPMorgan Chase & Co. (NYSE:JPM) earned $29 billion in revenue and $3.33 in GAAP EPS, missing analyst revenue estimates and beating them for EPS. Amidst the ongoing crisis in Ukraine, the bank reportedly received bond coupon payments from the Russian Federation according to a Reuters report.
Ken Fisher’s Fisher Asset Management is JPMorgan Chase & Co. (NYSE:JPM)’s largest investor through a $1 billion stake that comes via 7.4 million shares.
Miller Value Partners mentioned the bank in its fourth quarter 2021 investor letter. Here is what the fund said:
“I remember writing about the attractiveness of JP Morgan (JPM) right before it lost about a third of its value in the third quarter of 2011 (which didn’t please some of my colleagues!). I believed JPM was a high-quality bank whose prospects were undervalued due to the overhang on the space. It made money every year through the financial crisis.
In the decade-plus since then, JPM has beaten the market nicely (+417% versus SPX +345%) despite significant headwinds for banks (S&P Financial Sector +286%) and value stocks. Low market expectations are a key ingredient to attractive long-term returns!
An earthquake after-shock metaphor helps to explain the situation. Earthquakes relieve tension in physical systems, but aftershocks are common. These aftershocks aren’t as serious as the original event because stresses have been relieved. The financial crisis alleviated tensions in the financial system as weaker players either perished or were shored up with capital. Lessons learned impacted behavior (lower risk-taking behavior and higher propensity for monetary authorities to intervene supportively), which reduced future risk.
Those realities didn’t matter in the short term, but they sure did in the long term.”
