Merrill Lynch named JP Morgan Chase (JPM), the global financial service firm recently formed by the merger of JP Morgan & Co. and Chase Manhattan, as its Focus One Stock. The firm rates the shares near- and long-term buy.
Analyst Judah Kraushaar says JP Morgan Chase shares appear deeply undervalued when viewed as an emerging global securities play. He believes recent areas of investor controversy should fade. For example, Kraushaar thinks operating leverage should turn positive, merger integration success may be revealed, and private equity issues should subside. Additionally, he expects the company to benefit especially quickly compared with other banks from lowered interest rates.
The analyst maintains his $3.10 earnings per share estimate for 2000 and his $3.90 2001 forecast. He has a $75 one-year price target on the stock.