Seeking Alpha: JPMorgan Performing Well, But Credit Risk Back In Play

Not a lot is supposed to change in a month when you're talking about bank stocks, but it has been anything but an ordinary stretch since I last wrote about JPMorgan (NYSE:JPM). In those three weeks, the U.S. Big Four banks (JPMorgan, Citigroup (NYSE:C), Bank of America (NYSE:BAC), and Wells Fargo (NYSE:WFC)) have seen their shares fall around 10% to 20% on increasing worries about the health of the U.S. economy, the prospect for higher credit losses, and the uncertain outlook for rates.

There's definitely an interesting dichotomy between what banks are saying (good loan demand from businesses, generally good credit developments outside of energy) and what a lot of manufacturing / industrial companies are saying, and that ups the risk for 2016. As an asset-sensitive bank, JPMorgan should be able to generate better margins and returns as rates rise, but those increases may take a little longer to materialize. In the meantime, the bank continues to do a good job of shrinking its balance sheet, reducing its G-SIB burden, reducing costs, and pursuing revenue streams outside of banking. I still believe these shares should trade closer to $70, and with the declines in the stock it is a more interesting buy candidate than just a month ago.

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JPMorgan Performing Well, But Credit Risk Back In Play