JP Morgan Chase & Co (JPM)

It seems that everybody is out to get this company these days. This is unfortunate, because it is a great franchise. He typically moves on from things that have flies on them. He likes US banks and would suggest that you look at an equal weight U.S. Bank ETF.

They have had so much bad stuff. You would think coming out of the financial crisis the Fed would have found out if there were any more surprises.

Will still benefit from a recovering housing market. They are one of the larger, leading type of names which he continues to like. Their businesses look pretty solid. Investment banking is coming back. As the economy recovers, there will be lower loan losses. Trades at a pretty significant discount to its global and North American peers. 2.9% yield will grow.

This or a regional bank? Trading at around 9X earnings. Great management. One of the few companies that was able to survive through 2008 without requiring a bailout, but took it because they had to. Regarding regional banks, they are subjected to specific areas in the US and you can own both. Thinks they will both do very, very well. If you want less volatility and earnings, you should buy the regional banks. (See Top Picks.)

(A Top Pick March 26/13. Up 5.58%.) Still feels strongly about this. Under a little bit of pressure because of some regulatory issues on past sins in the mortgage business as well as issues with a London trader last year. Still likes.

Very similar to a lot of the banks whereby the results of late have increased and have done quite well but there is still a lot of headwinds. Growth in banks could be more positive but the headwinds need to go away first. Prefers other banks over this one.

Longer term you will do very well. Right now they have a big bulls-eye on them. Full of turmoil. They are a senior bank and quite safe. When economy gets legs under it they will do well. Between now and then he is not sure how volatile they will be. Hold it in balance but pare back if you have too much.

Likes the name. With the tapering talk, the financials became weak, but this is your premier large gap investment, wholesale banking name. Strong earnings.

Has a huge derivatives book and there is no disclosure on this. Does that bother you? Has harped about derivatives and their problems for years. He thinks they should change the whole marketplace. Regulators should clamp way down on it.

It is the best US bank and getting better. Continue to take market share.

Model price is $65.11, an 18% upside. You have to love US money.

(A Top Pick July 31/12. Up 50.69%.) Had thought that the market had overreacted on the London/Wale (?) thing and he knew the US economy was going to improve and it was a great entry point. Still cheap because the earnings keep growing at 20% a year. He can see this going to $75.

J.P. Morgan (JPM-N) or Wells Fargo (WFC-N)? The longer-term view on US banks is, for the last 30 years, one of cyclicality. If you catch the trades right, US banks are very, very good. This one had a good risk culture but Wells Fargo had a better one. The big challenge for the money center banks is that they are going to have the strong glare of the regulatory lights. You will definitely get upside gains from recovers of unemployment, people taking loans, health recovery, etc. Feels regional banks will offer you more upside. (See top picks.)

Likes this. Probably his favourite equity investment. The company has turned the corner and its balance sheet is going to look a lot different going forward than it did in the past. Well managed company.

All of the banks are challenged by loan growth and getting the net interest margin up. This one probably has more safety but more limited opportunities. At this point, with the pricing and valuations in the banks, he would probably gravitate towards Citibank (C-N). If you’re looking for mortgage exposure, J.P. Morgan or Wells Fargo (WFC-N) might be your choices.