J.P. Morgan shares close lower on Tuesday, bank establishes new division named Development Finance Institution

J.P. Morgan Chase & Co (JPM) said that it had established a new division named the Development Finance Institution in an attempt to support private investment in emerging-market development projects.

J.P. Morgan Chase shares closed lower for the fourth time in the past ten trading sessions in New York on Tuesday. The stock went down 0.98% ($1.36) to $136.84, after touching an intraday low at $136.73, or a price level not seen since January 15th ($136.15).

Shares of J.P. Morgan Chase & Co have retreated 1.84% so far in 2020 compared with a 2.79% gain for the benchmark index, S&P 500 (SPX).

In 2019, J.P. Morgan’s stock went up 42.80%, thus, it outperformed the S&P 500, which registered a 28.88% gain.

The Wall Street bank said in a press release that it could fund at least $100 billion annually from its investment bank. It has also developed a formal methodology to define projects, which fit both commercial and development objectives.

Meanwhile, Faheen Allibhoy, an 18-year veteran of the World Bank-affiliated International Finance Corporation, has been hired as head of the new division, J.P. Morgan said.

Development finance is expected to be one of the topics in focus during this week’s World Economic Forum in Davos. It can fund infrastructure projects such as bridges or wind farms and may also include microfinance lending to businesses.

With its Development Finance Institution business, J.P. Morgan seeks to support transformation of development finance into a traded asset class, originating assets for distribution to investors. The new division also aims to connect public and private pools of capital, ranging from pensions and family offices to philanthropies.

Analyst stock price forecast and recommendation

According to CNN Money, the 23 analysts, offering 12-month forecasts regarding J.P. Morgan Chase & Co’s stock price, have a median target of $141.00, with a high estimate of $170.00 and a low estimate of $85.00. The median estimate represents a 3.04% upside compared to the closing price of $136.84 on January 21st.

The same media also reported that at least 14 out of 26 surveyed investment analysts had rated J.P. Morgan Chase & Co’s stock as “Hold”, while 8 – as “Buy”. On the other hand, 2 analysts had recommended selling the stock.