JP Morgan Gets a Fan in Morgan Stanley

Yesterday, Morgan Stanley upgraded JP Morgan Chase (JPM) along with higher earnings estimates and a new price target of $53. By the end of trading yesterday, JPM was up 1.7% and closed at 47.55.

JPM has been the #2 stock in our rankings for the past 2 quarters, and unofficially, with TD Banknorth off the table, JPM is now our #1 ranked banking stock. It’s safe to say we like this stock.

However, our view of JPM hasn’t always been entirely rosy. As many have been saying about Citigroup (C) lately, JPM has been one of those stocks where the company seems to have great potential but the market just yawns at it. Morgan Stanley’s upgrade and new estimates gave it a bit of a boost, but there’s something else we’re looking for.

A previous posting of ours used JPM as an example of the power of reinvested dividends, but it also lamented the fact that JPM hasn’t raised its dividend for over 5 years. About a month later, we heard something we weren’t expecting: JPM’s CEO James Dimon stated that he’d like to up the dividend next year. It was far from a commitment, but it was more than we’ve heard for years.

So, thank you Morgan Stanley for recognizing JPM’s potential. It wasn’t news to us, but we need you to help the market out. Of more interest to us, if our CEO would care to provide any updates on the prospects for a dividend increase, we’re listening.

Disclosure: When this post was written, those involved with www.bankstockslist.com owned shares of JPM.