J.P. Morgan Chase & Co. (JPM): 3Q26 EPS: 2027 guidance implies ~$4bn (4%) PPNR upside; reiterate Buy

JPM reported 3Q26 EPS of $5.57 vs GSe/Visible Alpha Consensus of $6.10/$5.92, with core EPS of $6.05 vs. our/consensus like estimates of $6.28/$6.04. JPM delivered a 21.5% core ROTCE, ~4.5pp higher than the medium-term guide of 17%. We view the guidance constructively, specifically the 2027 NII ex Markets guide of ~$107bn, up 10% YoY, well above Street expectations of $103.1bn. While the company did not guide to total NII, we believe guidance and results are supportive of $115bn+ total 2027 NII, although management noted the range of outcomes is wider than normal given volatility in the rates curve. Further, the company noted that 2027 consensus expenses of ~$114bn are roughly at the right level, which we view positively as it implies potentially accelerating operating leverage from here. All in, the combination of higher NII and unchanged expenses suggest ~$4bn of 2027 PPNR upside (or 4%) vs. Street estimates. The company reiterated a focus on organic balance sheet growth, noting that