{"id":19413,"date":"2026-04-12T09:47:55","date_gmt":"2026-04-12T15:47:55","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=19413"},"modified":"2026-04-12T09:58:09","modified_gmt":"2026-04-12T15:58:09","slug":"jpmorgan-citigroup-earnings-previews-citi-is-the-more-defensive-stock-if-iran-and-other-issues-linger-in-2026","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=19413","title":{"rendered":"JPMorgan, Citigroup Earnings Previews: Citi is The More Defensive Stock if Iran and Other Issues Linger in 2026"},"content":{"rendered":"

Both JPMorgan (JPM) and Citigroup (C) report their Q1 ’26 financial results before the opening bell on Tuesday, April 14th, 2026, while Bank of America (BAC) follows up these reports with their own financial results before the market opens on Wednesday, April 15th, 2026.<\/p>\n

The one “macro” positive that has gotten very little attention in the financial media around Q1 ’26 financial results is that significantly-eased bank capital rules from the One Big Beautiful Bill (OBBB), could see banks add further to stock buybacks and dividend increases, but banks could also – if they are prudent, and most are – add to there reserves as we move inevitably to the next US recession. One aspect that has helped in terms of bank reserve loss additions is that – since 2022 when the Fed started raising rates and nearly every white-shoe brokerage firm forecast a recession would likely hit by late 2022 – have been adding to reserves. Jamie Dimon’s “economic hurricane” comment ( I suspect scared the daylights out of bank managements) since Jamie is now the dean of US bank CEO’s.<\/p>\n

However as we all know now, that US recession never happened in late 2022, and 2023, and the US economy – like Old Man River – rolled right along.<\/p>\n

Most bank investors are likely watching the following areas when the banks report this week:<\/p>\n

1.) Private credi<\/strong>t<\/strong><\/em> (issued by the banks and not the publicly-traded private credit companies) and the exposure therein not to mention any losses incurred.<\/p>\n

From everything I’ve read “private credit” risk is NOT a systemic risk to the US financial system, and those are Jay Powell’s words from a speech March 30th, but it doesn’t mean individual banks couldn’t have gone onboard on software loans, etc. Banks were doing their own private credit lending the last 5 years, for sure.<\/p>\n

2.) Consumer credit:<\/strong><\/em> the banks like JPM, and C, haven’t seen sharp increases to credit card debt losses or delinquencies yet, which I have always considered the most sensitive of the household debt given it’s unsecured status.<\/p>\n

3.) Capital market activity<\/strong><\/em> influenced by Iran and crude oil prices: for most of the big banks like JPM, and C, this activity would be found in the “fixed income, currency, and commodity” (FICC) segments. The SP 500 rallied 7.5% into the month end of March, which might have allowed banks and brokers to flip the “short, now long” book to capture some gains, but 18 years into a secular bull equity market, trading gains might get discounted some, just because they might be less plentiful in the future.<\/p>\n

\"\"<\/a><\/p>\n

(Click on the YChart graph to expand)<\/p>\n

In terms of stock total returns, (thanks to Ycharts), JPMorgan has been the top performer of the above-three names, even beating the SP 500, since 12\/31\/19, or just prior to Covid. Citigroup’s annual return is #2 and Bank of America is #3, but unlike JPMorgan, and Citi trailed the SP 500 during this 6 year and 3 month period.<\/p>\n

JPMorgan earnings preview:<\/strong><\/em><\/p>\n

When JPM reports Tuesday morning before the opening bell, consensus expectations per LSEG, is expecting $49.2 billion in net revenue for JPM, and $0.54 in earnings per share, for expected y-o-y growth of 9% and 7% respectively. In last Q1 ’25, JPM put up middling results of +6% net revenue growth and +10% EPS growth, following the very strong quarter from Q4 ’24, which contained the 7 weeks after President Trump was re-elected and there was a lot of bullish speculation around a Republican President, a Republican Senate and a Republican House.<\/p>\n

Last quarter, Q4 ’24, JPM net revenue of +8% and EPS of 9%, with above-Street guidance on net interest income (NII), asset management and equity and fixed-income trading BUT this was all pre-Iran. JPM also guided to 10% expense growth (per Morningstar) as well after Q4 ’25 results, so we will see if any of the current Iran-related events cause the guidance to be tempered for Q2 ’26 and beyond.<\/p>\n

Valuation:<\/strong><\/em> JPM is trading at 14x and 13x expected 2026 and 2027 EPS of $21.71 and $23.38 for expected y-o-y growth of 7% and 8% respectively so the PE valuations are just about 2x PEG (or PE-to-growth rates). JPM’s revenue growth is looking at mid-single digits over the next two years – ’26 and ’27 – given current sell-side estimates.<\/p>\n

JPM, like Goldman Sachs earnings preview from yesterday, is also trading well above book-value and tangible-book value, in the 2.5x and above, which is traditionally rich territory for a bank.<\/p>\n

Where JPM really shines as a top-tier bank the number that reflects this is JPM’s return-on-tangible common equity. This is normally a figure in the low 20% range consistently, except for Q4 ’25 when JPM’s ROTCE was 18%.<\/p>\n

This blog has sold more JPM in the last 6 months, simply due to the weight in client accounts requiring the JPM position to be pared, and haven’t added any shares in the last two quarters. JPM is still a top 10 position for clients. JPM’s PE valuation is actually reasonable if the EPS estimates hold up for calendar ’26 and ’27. In 2022, JPM started the year trading near $165 and fell all the way to $100 by October ’22 and the fed funds rate increases. That kind of liquidity withdrawal isn’t expected in ’26, but crude oil increases might capital market trading gains more difficult to come by. $290 is the 50-week moving average and held this latest pullback for the stock. The next technical level is around the $275 area.<\/p>\n

Citigroup Earnings Preview:<\/strong><\/em><\/p>\n

When Citi reports early Tuesday morning, April 14th, consensus estimates from LSEG expect $23.5 billion in net revenue and $2.65 in EPS, for expected y-o-y growth of 9% and 35% respectively.<\/p>\n

Last quarter, Q4 ’25, Citi put up 1% net revenue growth and +35% EPS growth, in a year where the former banking stalwart repurchased $13 billion in stock. Jane Fraser has done a heck of a job re-engineering the bank divisions, and shedding some divisions, while focusing on growth. After the Q4 ’25 results, Morningstar lifted 5 year growth targets for revenue, operating income and EPS, just in time for Iran to punch the bank right in the face.<\/p>\n

Citi is currently trading at 12x and 10x the next two calendar year’s EPS forecast of $10.39 and $12.19 respectively, which is expected to lead to EPS growth of 36% and 18% respectively, so Citi’s PE is at a big discount to expected EPS growth.<\/p>\n

With Citi’s results typically investors get low return on equity (7% – 9% range), a much more reasonable price to book value and tangible book value, and like other banks today, bigger share buybacks and the potential for dividend raises.<\/p>\n

For me, Citi is the “anti-JPM” or the yang, to JPM’s yin.<\/p>\n

Depending on how their trading results look, and guidance commentary, I would expect Citi to be a more defense stock if Iran and certain issues develop in the calendar year that is 2026. If the SP 500 returns 15% in 2026, then JPM has a greater ability to milk more out of that type of economy and capital market activity than Citi.<\/p>\n

Summary: <\/strong><\/em>Judging by the headlines on Sunday morning, April 12th, emanating from Islamabad, it appears the Strait of Hormuz issues will not be resolved and that American’s face the prospect of higher oil and gasoline prices for the foreseeable future. This being said, it’s hard to know what’s reality and what’s diplomacy.<\/p>\n

When Goldman reports Monday morning, and JPMorgan and Citigroup report Tuesday morning, the results are likely to be decent – at least consensus – but the management commentary could be filled with the anxiety over what’s to follow the next few months.<\/p>\n

Rather than pack a 3rd bank preview into today’s post, Bank of America will be previewed separately and posted Monday, April 13th.<\/p>\n

The banking and financial system are in a good position from a credit perspective, but that can change quickly. Don’t be surprised if investors see bigger buybacks and dividend increases.<\/p>\n

None of this is advice but rather an opinion to be considered. Past performance is no guarantee of future results. LSEG is the source of all EPS and revenue estimates.<\/p>\n

Thanks for reading.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Both JPMorgan (JPM) and Citigroup (C) report their Q1 ’26 financial results before the opening bell on Tuesday, April 14th,…<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[38,278,27],"tags":[],"class_list":["post-19413","post","type-post","status-publish","format-standard","hentry","category-bac","category-c","category-jpm"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/19413","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19413"}],"version-history":[{"count":10,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/19413\/revisions"}],"predecessor-version":[{"id":19434,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/19413\/revisions\/19434"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19413"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19413"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19413"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}