Options Traders Eye Blue-Chip Bank's Q1 Results

The equity tends to fall after earnings

Jake Scott

Deputy Editor

Apr 11, 2023 at 12:10 PM

SIVB
JPM

JPMorgan Chase & Co (NYSE:JPM) will report first-quarter financial results before the open on Friday, April 14. The blue-chip bank concern has a disappointing post-earnings past, ending six of its last eight next-day sessions in the red. Regardless of direction, JPM averaged a 2.9% next-day return, which is lower than the 4.8% swing options players are pricing in this time around.

Last seen up 0.6% to trade at $128.64, JPM has suffered alongside other major banks after the collapse of SVB Financial Group (SIVB). The equity recently dipped below its 200-day moving average, and though it's trading back above this trendline, it remains down on a year-to-date and year-over-year basis. JPMorgan Chase stock is now outpacing the Financial Select Sector SPDR Fund (XLF), though, and history suggests the battered sector is due for a rally.

JPM Chart April 112023

There has been an uptick of bullish activity in JPM's options pits. This is per the stock's Schaeffer's put/call open interest ratio (SOIR), which ranks in the low 19th percentile of annual readings. This suggests short-term options traders have rarely been more call-biased.

Analysts are similarly optimistic, with 13 of 19 in coverage rating JPMorgan Chase stock a "buy" or better. Plus, the 12-month consensus target price of $151.70 is an 18% premium to JPM's current perch.

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