Jim Cramer Says These 10 Stocks Will Go Higher in Trump Presidency

4. JPMorgan Chase & Co (NYSE:JPM)

Number of Hedge Fund Investors: 111

Jim Cramer said in the latest program on CNBC that major bank stocks are “still cheap” despite having a bull run after the Trump victory. He thinks Trump’s presidency would bode well for these stocks.

“The banks have been pushed down for ages because the Democrats, who love to go after the industry. That in turn really debilitated them. Now, the banks can be unfettered. They might be able to merge again. More importantly, the investment banks can focus on many more mergers, and regulators will look the other way. We’ll likely see more IPOs, too. It’s hard to convey how much tension there was between bankers and the Biden administration. They were like oil and water, that’s it.”

Cramer said he sold some bank stocks after the latest run but recommended investors buy them on the dip because he thinks they are still cheap.

JPMorgan Chase & Co (NYSE:JPM) remains among the biggest banks in the US despite fears of recession and rising loss provisions. The bank’s Q3 results showed a notable boost in profitability, driven by a combination of increased net interest income and lower non-interest expenses. Pre-tax income, before accounting for loan loss provisions, surged to $20.1 billion. Even though loan loss provisions jumped sharply from less than $1.4 billion in Q3 2023 to over $3.1 billion in Q3 2024, pre-tax income still grew by several hundred million.

Despite the rise in loan loss provisions, the bank remains well-positioned. Loan provisions fluctuate with the economic cycle, being lower in prosperous years and higher during downturns. Although 2024 may be a more challenging year, JPMorgan Chase & Co (NYSE:JPM)’s financial performance demonstrates it can easily absorb these higher provisions. In fact, JPMorgan Chase & Co (NYSE:JPM) is capable of managing up to $20 billion in loan loss provisions annually before it faces a loss. While concerns about bank safety and rising provisions are valid, larger U.S. banks like JPMorgan Chase & Co (NYSE:JPM) are in a strong position to weather such fluctuations. JPMorgan Chase & Co (NYSE:JPM)’s CET1 ratio of 15.3% stands out as an enviable metric among its peers.