JP Morgan (NYSE: JPM) released its fourth quarter earnings report on Wednesday. After initially opening in the red, shares have moved higher.
The financial giant beat earnings’ estimates by nearly 20 percent, posting an EPS of $1.39 — more than the $1.16 analysts were expecting. After posting a net income of $3.7 billion in the final quarter of 2011, JP Morgan boasts a $5.7 billion profit this time around.
Revenue figures were right on par with analyst estimates. JP Morgan reported revenue of $24.4 billion, nearly in line with the $24.42 billion consensus estimate.
Meanwhile, JP Morgan’s rival Goldman Sachs (NYSE: GS) also released its fourth quarter earnings Wednesday.
Analysts had estimated the investment giant would post an EPS of $3.48 per share. However, the New York bank posted earnings of $5.60 per share, blowing away the estimates and more than tripling year-over-year.
The company also posted a net income of $2.89 billion for the fourth quarter, nearly triple the just over $1 billion reported in the same period of 2011.
Over the course of 2012, Goldman generated over $34 billion in revenue and squeezed out nearly $7.5 billion in profit.
Market Reaction
Despite JP Morgan’s successful earnings, its stock was subdued on Wednesday.
JP Morgan’s market misfortunes may be the result of a pending investigation by the FSA (UK regulator) and other regulators involving trading losses in the company’s London branch.
The investigation involves $6.2 billion in bad credit derivative bets, as notes the International Business Times.
On the bright side, Goldman Sachs has fared much better in the early hours of trading. The stock has risen sharply, up nearly 3 percent.
Look for investors to remain hesitant on JP Morgan as the investigation into its risky trading unfold. Goldman Sachs may be a better bet at the moment, given its strong fourth quarter and ability to dodge a black eye thus far in 2013.
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