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Earnings Awaited: The Mighty Blue-Chip Banking Behemoth

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TLDR:

  • JPMorgan Chase will report fourth-quarter financial results on Friday, Jan. 12
  • JPMorgan Chase stock has an upbeat post-earnings history, with gains in its last five next-day sessions
  • Options players are pricing in a 4.1% swing, higher than the average 3.3% return over the last two years
  • Bearish activity has increased in JPM’s options pits, suggesting short-term traders have been more put-biased

JPMorgan Chase & Co (NYSE: JPM) is set to report its fourth-quarter earnings and revenue on Friday, Jan. 12. The banking giant has historically experienced upbeat post-earnings performance, with gains in its last five next-day sessions. Over the last two years, JPM has averaged a 3.3% return on the day following earnings. However, options players are pricing in a larger swing this time around, with a 4.1% move expected.

The stock has largely managed to shrug off the New Year jitters seen in the broader market, hitting an all-time high of $173.38 on Jan. 5. Despite currently trading 0.7% lower at $169.46, JPM still boasts a 22.2% year-over-year lead. However, the stock has moved below its 10-day moving average and is on track for its third-straight loss.

Bearish activity has been on the rise in JPM’s options pits, as indicated by the stock’s Schaeffer’s put/call open interest ratio (SOIR) of 1.80. This SOIR ranks in the elevated 99th percentile of annual readings, suggesting that short-term options traders have rarely been more put-biased.

In summary, JPMorgan Chase is slated to report its fourth-quarter earnings and revenue on Jan. 12. The stock has a positive post-earnings history, but options players are pricing in a larger-than-average move this time around. There has been an increase in bearish activity in JPM’s options pits, signaling that short-term traders have been more put-biased.

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