JPMorgan Chase & Co.JPMNYSE

Overview Intelligence Charts News Fundamentals

DCF Valuation

DCF Valuation Summary

Sell

Fair Value: $241.54 per share(market-calibrated)

-19.6%

Upside to Fair Value

Current

$300.26

Pure Model

$235.17

Fair Value

$241.54

Bull Case

$238.57

Bear Case

$223.65

Market Reality Check

Model Terminal Growth

2.50%

Market-Implied Growth

4.56%

Calibrated Growth

3.01%

Fair value uses 75% model / 25% market-implied terminal growth. Pure model: $235.17.

What's Driving This Ratingfor JPM

✓

CapEx already efficient

CapEx at 0.00% of revenue is already at or below sector maintenance level. No normalization needed — cash conversion is already strong.

✓

Premium margins already priced in

EBIT margin of 31.30% is already well above sector average. The model holds this level — there's limited room for margin expansion to drive upside. Valuation depends primarily on revenue growth.

→

Moderate revenue growth

Analyst consensus projects -30.49% revenue growth, fading to 2.50% by Year 10. Revenue reaches $258.2B (vs $280.3B today).

🎯

Market pricing in higher long-term growth

To justify $300.26, the market implies 4.56% perpetual growth — 206bps above the model's 2.50%. This suggests the market sees additional growth catalysts (AI, new products, market expansion) not captured in analyst estimates.

✓

Strong cash flow conversion

Year 10 FCF/EBITDA conversion of 79.63% indicates efficient cash generation. FCF reaches $70.1B by Year 10 (27.16% FCF margin).

Weighted Average Cost of Capital (WACC)

Cost of Equity (CAPM)

Risk-Free Rate (Rf)4.50%

Beta (β)1.06

Market Risk Premium4.50%

*Using current implied premium (4.5% per Damodaran 2026), not historical (6.5%)

Cost of Equity (Re)9.27%

Cost of Debt

Pre-tax Cost of Debt12.49%

Tax Rate21.42%

After-tax Cost of Debt9.81%

Equity Weight (E/V)62.61%

Debt Weight (D/V)37.39%

WACC Calculation

WACC = (E/V × Re) + (D/V × Rd × (1-Tc))

WACC = (62.61% × 9.27%) + (37.39% × 9.81%)

= 9.47%

10-Year Free Cash Flow Projections(showing years 1, 3, 5, 7, 10)

Year	Year 1	Year 3	Year 5	Year 7	Year 10
Revenue	$194.9B	$214.3B	$228.2B	$239.7B	$258.2B
EBIT	$61.0B	$67.1B	$71.4B	$75.1B	$80.8B
Tax	$13.1B	$14.4B	$15.3B	$16.1B	$17.3B
NOPAT	$47.9B	$52.7B	$56.1B	$59.0B	$63.5B
+ Depreciation	$5.5B	$6.0B	$6.4B	$6.7B	$7.2B
- Capex	--	--	--	--	--
- Δ NWC	-$8.5B	$1.1B	$557M	$585M	$630M
Free Cash Flow	$61.9B	$57.7B	$62.0B	$65.1B	$70.1B
Discount Factor	0.913	0.762	0.636	0.531	0.405
Present Value	$56.6B	$43.9B	$39.4B	$34.6B	$28.4B

FCF Formula: Free Cash Flow = NOPAT + Depreciation - Capex - Change in Net Working Capital

Terminal Value Calculation

Perpetuity Growth Method

Year 10 FCF$70.1B

Terminal Growth Rate2.50%

WACC9.47%

TV = FCF₁₀ × (1+g) / (WACC-g)

Terminal Value$1.0T

PV of Terminal Value$417.1B

Exit Multiple Method

Year 10 EBITDA$88.1B

Exit Multiple (EV/EBITDA)12.0x

TV = EBITDA₁₀ × Exit Multiple

Terminal Value$1.1T

PV of Terminal Value$427.5B

Valuation Summary

Perpetuity Growth Method

PV of Projected FCFs$390.2B

PV of Terminal Value$417.1B

Enterprise Value$807.3B

(-) Net Debt$156.6B

Equity Value$650.6B

Shares Outstanding2.8B

Price per Share$233.31

Exit Multiple Method

PV of Projected FCFs$390.2B

PV of Terminal Value$427.5B

Enterprise Value$817.7B

(-) Net Debt$156.6B

Equity Value$661.0B

Shares Outstanding2.8B

Price per Share$237.03

Pure Model Fair Value

$235.17

Average of perpetuity growth and exit multiple methods (before market calibration)

Sensitivity AnalysisPrice per Share

WACC ↓ / Growth →	1.50%	2.00%	2.50%	3.00%	3.50%
7.47%	$293.40	$303.46	$315.55	$330.33	$348.85
8.47%	$255.45	$262.16	$269.98	$279.24	$290.36
9.47%	$225.15	$229.83	$235.17	$241.34	$248.55
10.47%	$200.18	$203.55	$207.35	$211.66	$216.59
11.47%	$179.12	$181.62	$184.41	$187.52	$191.02

How to read: This table shows how the valuation changes with different WACC (discount rate) and terminal growth rate assumptions. Green = undervalued, Red = overvalued.

Scenario Analysis

Bear Case

$223.65

-25.5% vs current

• -25% vs analyst consensus
• Terminal growth: 2.0%
• Beta: 1.32

Base Case

$235.17

-21.7% vs current

• Analyst consensus
• Terminal growth: 2.5%
• Beta: 1.06

Bull Case

$238.57

-20.5% vs current

• +25% vs analyst consensus
• Terminal growth: 3.0%
• Beta: 0.90

Key Assumptions & Drivers• Financial Services Sector

Growth Assumptions (Select Years)

Year 1 Revenue Growth-30.49%

Year 3 Revenue Growth5.26%

Year 5 Revenue Growth2.50%

Year 7 Revenue Growth2.50%

Year 10 Revenue Growth2.50%

Terminal Growth Rate2.50%

Margin & Efficiency

Current EBIT Margin31.30%

Tax Rate21.42%

Historical Capex / Rev0.00%

NWC / Revenue10.00%

Key Drivers: Revenue growth, operating margin expansion, capex efficiency, and working capital management are the primary drivers of cash flow generation. Terminal value assumptions significantly impact final valuation.

Institutional-Grade Methodology

Actual Company Data: Revenue, EBIT, Capex, NWC, Tax Rate, Interest Expense, Beta

Market Assumptions: Risk-free: 4.5% (10Y), MRP: 4.5% (Damodaran 2026), Exit: 12x EV/EBITDA (Financial Services sector)

This DCF model is for informational purposes only. Projections are based on assumptions that may not materialize. Past performance does not guarantee future results. Consult a financial advisor before making investment decisions.

Explore More

S&P 500 Screener

Filter and sort all 500 stocks

Market Movers

Today's biggest gainers and losers

Market Heatmap

Visual sector performance