5 Blue Chip Stocks to Buy According to Mario Gabelli

3. JPMorgan Chase & Co. (NYSE:JPM)

Number of Hedge Fund Holders: 110

Mario Gabelli’s Stake Value: $55,492,000

Percentage of Gabelli’s Portfolio: 0.50%

Stock Price as of June 15: $119.55

JPMorgan Chase & Co. (NYSE:JPM) is a New York-based diversified financial services company providing solutions to corporations, governments, and institutions present across 100 countries. JPMorgan Chase & Co. (NYSE:JPM) is also a constituent of the Dow Jones Industrial Average since May 1991.

Following its investor day, Andrew Lim at Societe Generale upgraded the stock from a Hold to a Buy rating and increased the target price from $145 to $150 on May 24. The analyst stated that JPMorgan Chase & Co. (NYSE:JPM) provided a positive outlook on credit quality, investment bank trading revenues, and net interest income. Lim added that there is too much negativity priced into the stock due to fears of recession, and he anticipates significant capital generation in 2023.

Here’s what Ariel Investments has to say about JPMorgan Chase & Co. (NYSE:JPM) in its Q4 2021 investor letter:

“In our view, inflation will not just be a 2021 phenomenon. Inflationary expectations are only now working themselves into the labor market with historically low unemployment, resurgent labor unions, and higher wages. These labor cost pressures are only starting to show up in the Consumer Price Index. The most recent Producer Price Index showed a +9% year over year increase, the highest since it was created in 2010. Higher input prices generally lead to rising consumer prices.

“In our view, inflation will not just be a 2021 phenomenon.”

Consumer balance sheets are in excellent shape with lower unemployment and banked stimulus checks. A recent analysis from JP Morgan Chase (JPM) showed average checking accounts have 50% higher balances than pre-Covid. The U.S. money supply as measured by M2 (a calculation that includes cash, checking accounts, and “near cash” such as money market securities) is up +38% versus year-end 2019. Higher consumer cash holdings and higher money supply mean more spending and demand for goods. Some emphasize supply issues to explain current inflation. Going forward, we see very strong demand as well, too much money chasing too few goods.”

At the end of Q1 2022, 110 funds held a stake in JPMorgan Chase & Co. (NYSE:JPM).