JPMorgan Expected to Post Lower 4Q EPS -- Earnings Preview

By Emily GlazerFeaturesDow Jones Newswires

JPMorgan Chase & Co., the largest U.S. bank by assets, is expected to report fourth-quarter results before the market opens Friday. Here's what you need to know.

1. Earnings Expected to Fall

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Earnings of $1.69 a share are the consensus of analysts surveyed by Thomson Reuters. That would represent a decrease of nearly 2% from the $1.71 a share the company earned in the same period a year earlier. On a reported basis, or under generally accepted accounting principles, earnings per share are expected at $1.16, reflecting one-time charges related to the tax law.

2. Higher Revenue as Well

Revenue of $25.15 billion is forecast, compared with $23.4 billion reported in the year-earlier quarter.

3. Tax Overhaul Impact

Chief Financial Officer Marianne Lake said during an investor conference in early December -- before the tax bill's passage -- that the bank could have a one-time hit of up to $2 billion in the fourth quarter if the tax overhaul was enacted in 2017. The bank hasn't commented since and it is expected to give more information when it reports fourth-quarter earnings. Charges would likely relate to changes in the value of the bank's deferred tax assets and the need to repatriate profits held overseas. Such charges could reduce the earnings the bank reports, although investors are likely to look to the core operating results since these hits will be one-time in nature.

4. Trading Headwinds, Again

Ms. Lake also said in early December that trading revenue was likely to fall around 15% in the fourth quarter compared with the year-earlier period. Ms. Lake at the time said there are "not many catalysts," and volatility remains "low across the spectrum."

5. Cryptocurrency Commentary

Investors will be poised to hear any fresh perspective from Chief Executive James Dimon about cryptocurrencies. He famously had declared bitcoin a "fraud," but earlier this week backpedaled on that during a television interview. Since Mr. Dimon last year lashed out at bitcoin, CME Group Inc. and Cboe Global Markets Inc. have begun trading bitcoin futures. That is helping to legitimize the cryptocurrency with some institutional investors. While Mr. Dimon has been critical of cryptocurrencies, he has been bullish about the technology underpinning bitcoin, known as blockchain.

Write to Emily Glazer at emily.glazer@wsj.com

(END) Dow Jones Newswires

January 11, 2018 12:14 ET (17:14 GMT)