We recently published a list of 10 Most Profitable Value Stocks to Buy Now. In this article, we are going to take a look at where JPMorgan Chase & Co. (NYSE:JPM) stands against other profitable value stocks to buy now.
Matt Powers, Managing Partner at Powers Advisory Group, joined the discussion on CNBC’s ‘Power Lunch’ on March 11 to provide insights into the shift from growth to value investing and the resurgence of traditional dividend strategies. Powers emphasized that this transition has become increasingly evident, particularly following last week’s market activity and the events of March 10. He noted that while the market behavior on March 11 might tell a slightly different story, the broader trend is unmistakable. For years, growth stocks dominated portfolios, but now investors are gravitating toward value and dividend investing, which had been largely overlooked for over a decade. Powers attributed this shift to various catalysts, which included tariffs and policy uncertainty from Washington and President Trump’s unpredictable stances. He described investors as exhausted, and welcomed the normalization of equity markets and a return to diversification and traditional investing.
Powers highlighted the importance of diversification, contrasting high-growth portfolios with those focused on dividends. He pointed out that ETFs have outperformed large-cap growth funds year-to-date, with a notable 11-point difference in returns. The dividend fund is up 5%, while the large-cap growth fund is down 6%. He explained that tech stocks dominate large-cap growth funds and account for nearly half of their portfolios. In contrast, dividend-focused funds are more diversified across sectors such as healthcare, financials, and staples. This diversification reduces concentration risk and provides defensive characteristics in an uncertain market environment. Powers elaborated on the leadership shift between these two types of funds. While growth ETFs feature holdings like the MAG7, dividend ETFs focus on blue-chip companies. A year ago, growth stocks were investor favorites, but now value stocks are taking the lead, which is a trend reflected in their performance. He stressed the importance of broadening diversification within portfolios and not ignoring value opportunities.
Methodology
We sifted through the Finviz stock screener to compile a list of the top stocks with a forward P/E ratio under 15. We then selected the 10 stocks with a TTM net income greater than $1 billion and that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024.
Note: All data was recorded on March 13.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A customer signing a loan agreement with the bank’s representative in a private office.
JPMorgan Chase & Co. (NYSE:JPM)
TTM Net Income as of March 13: $58.471 billion
Forward P/E Ratio as of March 13: 12.39
Number of Hedge Fund Holders: 123
JPMorgan Chase & Co. (NYSE:JPM) is a financial services leader that operates through Consumer & Community Banking, Commercial & Investment Bank, and Asset & Wealth Management segments. It offers banking, lending, investment, and wealth management solutions.
The company’s Consumer & Community Banking (CCB) segment reported $18.4 billion in revenue for Q4 2024, which represented a 1% year-over-year increase. The growth was largely driven by its Card Services business, which saw an 11% increase in card outstandings and a boost in Net Interest Income (NII) due to higher revolving balances. Nearly 10 million new card accounts were acquired during 2024.
JPMorgan Chase & Co. (NYSE:JPM) anticipates continued growth in the card business, although at a slightly moderated pace compared to 2024. The company expects to see more visible deposit growth in H2 2025, with consumer checking deposits already showing positive signs. It will also focus on wealth management growth and expand its branch network, under its commitment to the CCB segment.
Carillon Eagle Growth & Income Fund stated the following regarding JPMorgan Chase & Co. (NYSE:JPM) in its first quarter 2024 investor letter:
“JPMorgan Chase & Co. (NYSE:JPM) contributed positively to performance following solid financial results and positive guidance for the remainder of 2024. Moreover, growing chatter around rising capital markets activity likely contributed to the stock’s strong performance relative to other banks. Recall that JPMorgan has a robust capital markets franchise.”
Overall, JPM ranks 1st on our list of the most profitable value stocks to buy now. While we acknowledge the growth potential of JPM as an investment, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than JPM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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