Financial Heavyweights Earnings Face Off: JPM vs. BAC vs. WFC

Representing the largest U.S. financial centers and regional banks, Invesco KBW Bank ETF (KBWB) performed exceptionally well over the last year, delivering a 27.4% return to shareholders. The top five banks have the largest weight in the portfolio – Goldman Sachs Group, Wells Fargo & Co, Morgan Stanley, JPMorgan Chase & Co, and Bank of America.

Bank of America, Wells Fargo and JPMorgan Chase already delivered their results earlier this week. Let’s examine which bank has the lead. More importantly, which bank has the highest stock potential at this moment?

JPMorgan Chase & Company (NYSE: JPM) – 12.7% Upside Potential

With a reported $5.23 adjusted earnings per share (EPS), JPM beat the Wall Street consensus of $4.86. The bank also beat TD Cowen’s estimate of $5.02. Likewise, the bank’s revenue of $46.77 billion exceeded the forecasted $46.25 billion, representing 7% growth. However, JPM’s net income of $13.025 billion is down 9.5% from the previous quarter

On the investment banking front (market revenue), JPM reported largest growth YoY of 17% at $8.2 billion. JPM’s Consumer & Community Banking (CCB) dropped 19% to $3.6 billion net income, but up 6% with net revenue of $19.4 billion. The bank’s net interest income was $25.1 billion, up 7%.

Following the agreement to purchase Apple’s credit card program from Goldman Sachs, JPM is preparing to take a hit of $4.2 billion for credit losses (up from last year’s $2.6 billion).. The net charge-offs (NCOs) of $2 billion are the actual loss for the quarter, referring to borrowers who stopped paying their credit cards or entered bankruptcy.

Although the NCO figure is in line with $2.1 billion in the year-ago quarter, it was enough to offset the beaten earnings. Consequently, JPM stock is down 5.62% over the week at the present price of $307.87 per share. Year-over-year, however, JPM shares are up nearly 25%.

Given the fact that JPM is a Global Systemically Important Bank (G-SIB), the current price dip creates an optimal entry for exposure, as the average JPM price target is $347.30 per share.

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Bank of America Corp. (NYSE: BAC) – 19% Upside Potential

With a reported $0.98 EPS, up 18% YoY, Bank of America beat its consensus forecast of $0.96. The revenue is up 6.5% YoY to $28.37 billion, beating the analyst estimates of $27.59 billion. The bank’s fastest growing segment is investment management, up 10% with a revenue of $6.6 billion, while consumer banking is responsible for 5% growth at $11.2 billion revenue.

Overall Bank of America delivered full-year 2025 net income of $30.5 billion, up 19% YoY, boosted by Q4’s earnings of $7.6 billion. The bank’s efficiency ratio, as a measure of managing overhead costs relative to its income, is 62% for the year, just under 63% for 2024. As a reminder, the lower figure indicates improved efficiency, with around 60% being the sweet spot for most well-run banks, while under 50% is best-in-class efficiency.

Owing to zero-fee usage through the Zelle network, Bank of America’s online banking facilitated 474 million transactions worth $144 billion, which is up 13% YoY. Lastly, the bank’s net interest income grew 10% YoY to $15.8 billion, outperforming JPM.

Year-over-year, BAC stock is up 11.4% to the current price of $52.48 per share. This is below the bottom outlook of $55, while the average BAC price target is $62.30 per share.

Wells Fargo & Company (NYSE: WFC) – 15% Upside Potential

In line with analyst forecasts, Wells Fargo’s net income increased by 6% to $5.4 billion. Joining Bank of America, both banks reported highest full-year earnings over the last four years. Compared to the other two banks here, the revenue had moderate growth of 4.5% YoY at $21.29 billion.

Following the trend, investment management delivered the highest YoY growth of 14% to $134.5 billion. The bank’s efficiency ratio significantly improved from the year-ago quarter of 68%, dropping to 64% this quarter. Wells Fargo’s net interest income increased 4% to $12.3 billion.

The bank’s NCO increased 11% from the previous quarter but is still down 13.6% from the year-ago quarter at $1.046 billion.

Year-over-year, WFC stock is up nearly 17%, at the current price of $89.18 per share. This is only slightly below the bottom outlook of $90, while the average WFC price target is $102.70 per share.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.