Research Blog

J.P. Morgan - "No Race to be First"?

As both the American Banker (The Art and Ego of Timing Bank Earnings Releases) and the Wall Street Journal, (Why J.P. Morgan Moved Its Earnings Relase), observed this week, for the first time in a long time J.P. Morgan chose to announce its earnings after the market close today, as opposed to before the opening bell as they have done consistently, every quarter, since at least 2Q 2005.  The reason everyone is paying attention is because for many analysts, investors and journalists J.P. Morgan's earnings press release marks the beginning of the earnings season for the big-banks.  And while this is not the type of date change that many of our clients track as a source for alpha, its nonetheless a pretty interesting story . . . and here is why . . .  

As you will see from the chart below (chart #1), not only does J.P. Morgan typically announce before the opening, they also tend to announce before their peers.  In fact, since 3Q 2008 J.P. Morgan has announced before their peers every quarter with the exception of two (2).  And prior to 3Q 2008 you can see that this was generally not the case.  So what changed?   Well, nothing according to a J.P. Morgan spokesperson who told the Wall Street Journal, "We put out the earnings as soon as they are ready".  

So for fun, we looked at the timing of when these banks typically announce their earnings dates (chart #2), and found that the past two quarters were fairly indicative of how J.P. Morgan typically announces their earnings dates . . .they wait for their competitors to announce first, and then they pick an earlier date.  And with respect to this quarter they probably did not want to have their earnings call before the market opened, the day after a holiday, so it was to be . . . break the "before -the-bell-tradition" and do it at 5:00pm ET on October 13th  . . . but just make sure it's before Bank of America! (October 14, 8:30am ET, more details HERE)

Chart #1