In an effort to extend its helping hand toward struggling homeowners who have to make their mortgage payments, JPMorgan Chase & Company (JPM) said on Monday that it is almost doubling its nationwide network by adding 24 more Chase Homeownership Centers, including one in Dallas.
The 27 existing centers of JPMorgan have already served 60,000 struggling families who have to make monthly mortgage payments. The new additions will take the total number of JPMorgan mortgage assistance centers to 51 in 14 states and Washington D.C.
JPMorgan will open six of the new 24 mortgage assistance centers in markets that have been hit hard by the housing and economic downturns and currently don’t have a center. The other 18 new centers will supplement markets that already have centers.
In 2009, JPMorgan has approved more than 568,000 new mortgage modifications under its own modification program, the U.S. Making Home Affordable Program, and Fannie Mae (FNM), Freddie Mac (FRE) and FHA programs.
JPMorgan is scheduled to release its fourth quarter and full year 2009 earnings tomorrow. The Zacks Consensus Estimate for fiscal 2009 is earnings of $2.15 per share, a significant growth over the recession-hit fiscal 2008. However, concern related to persistent high levels of credit costs in JPMorgan’s loan portfolios prompted 5 of 20 analysts covering the stock to lower their estimates in the last 30 days, while only 2 analysts moved in the opposite direction as they are optimistic about the stock with the company’s full repayment of the bailout money, which has taken it out of government intervention.
In all, the greater number of downward estimate revisions indicate a slight downside potential on the performance of the stock in the near term. As a result, the stock retains its Zacks # 4 Rank, which translates to a short-term ‘Underperform’ rating.
With respect to earnings surprises, it had significant positive surprises in the last three quarters, but with an extreme negative surprise in the fourth quarter of 2008, the four-quarter average remained negative. This implies that on average, JPMorgan has fallen short of the Zacks Consensus Estimate over the last four quarters.
While we anticipate continued synergies from JPMorgan’s diversification and strong capital position, we believe increasing provisions and worsening credit quality will be a drag on future earnings. In the long term, we continue to rate the stock as ‘Neutral’.
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