JPMorgan vs. PNC Financial: Which Bank Stock Is the Smarter Buy Today?

JPMorgan JPM is one of the "Big Four" global banks, while PNC Financial Services PNC is a prominent super-regional bank. JPM leverages its massive scale and diversified financial services, while PNC is distinguished by its prudent growth strategy and targeted regional expansion. 

With the Federal Reserve expected to start an interest rate cut cycle later this month, it is vital to understand how both these “systematically important financial institutions” navigate the evolving operating environment. Let’s analyze JPMorgan and PNC Financial’s business models to determine which one presents a solid investment opportunity.

The Case for JPMorgan

JPMorgan’s balance sheet is highly asset-sensitive. Hence, the Fed rate cut is likely to put downward pressure on the company’s net interest income (NII). Lower rates will lead to reduced asset yields on variable-rate loans and securities, compressing margins unless deposits or funding costs are repriced more quickly.

Nonetheless, management expects the near-term impact of rate cuts to be manageable, driven by robust loan demand and deposit growth. JPMorgan raised its 2025 NII guidance to almost $95.5 billion, highlighting continued strength but warning that further moves are “market dependent.” Earlier, the bank had guided NII to be approximately $94.5 billion for this year.

Additionally, JPMorgan is expanding its footprint in new regions despite the rise of mobile and online banking. The bank plans to open more than 500 branches by 2027, with 150 already built in 2024. This initiative aligns with the company’s broader effort to tailor its branch network to meet client needs and relationships and boost cross-selling across mortgages, loans, investments and credit cards.

JPM continues to be a dominant player in the investment banking (IB) business, holding the top position for global IB fees. With the macroeconomic backdrop turning favorable for the industry, the company is expected to benefit, as its leadership position in the space is likely to offer additional support. 

With the clearance of the 2025 stress test, JPMorgan announced plans to increase its quarterly dividend by 7% to $1.50 per share and authorized a new share repurchase program worth $50 billion. Also, it remains vigilant about the effects of continuous high rates and quantitative tightening on its loan portfolio. As such, the company’s asset quality is likely to remain under pressure in the near term. JPM expects card net charge-off rates to be 3.6% this year, with the metric projected to rise to 3.6-3.9% in 2026.

The Case for PNC Financial

Similar to JPM, PNC Financial is expected to have a limited impact of interest rate cuts on its NII this year. The repricing of fixed-rate assets, loan growth and stabilizing funding costs are expected to support the metric. Management anticipates NII to rise 7% year over year in 2025.  

Further, PNC has announced plans to enhance its coast-to-coast branch network. Over the next five years, it aims to invest $1.5 billion to open more than 200 new branches across 12 U.S. cities and renovate 1,400 existing locations. With the addition of these branches, the company will solidify its position as one of the largest retail banks in the United States. 

PNC Financial is accelerating growth through acquisitions and partnerships, with an aim to broaden its capabilities and revenue streams. In August 2025, it acquired Aqueduct Capital Group, strengthening fund placement services at its global IB arm, Harris Williams. Last year, it partnered with Plaid to enable secure data sharing and expanded its TCW Group alliance to offer private credit to middle-market firms. These, together with earlier moves like the 2022 acquisition of Linga and the 2021 buyout of BBVA USA, help diversify its business mix.

After clearing the stress test, PNC announced a 6% hike in the quarterly dividend to $1.70 per share in July. Apart from regular dividend hikes, it also has a share repurchase program in place. As of June 30, 2025, the company had nearly 39 million shares remaining under the authorization.

An elevated expense base remains a headwind despite PNC Financial's cost-containment measures. Further, the lack of diversification in the loan portfolio is concerning and may put pressure on its asset quality.

JPMorgan & PNC Financial’s Prospects

The Zacks Consensus Estimate for JPM’s 2025 revenues suggests a marginal decline, while for 2026, revenues are expected to grow 3.5%. Likewise, the consensus estimate for earnings implies a nearly 1% fall for this year. However, earnings are projected to increase 4.1% next year. Analysts are gradually turning bullish on JPM’s prospects, with earnings estimates moving higher over the past month.

JPM Earnings Estimate
 

On the contrary, the Zacks Consensus Estimate for PNC’s 2025 and 2026 revenues implies year-over-year growth of 6.3% and 5.9%, respectively. The consensus estimate for earnings indicates an 11.7% and 11.5% rise for 2025 and 2026, respectively. In the past 30 days, earnings estimates have remained unchanged.

PNC Earnings Estimate
 

JPM vs. PNC: Price Performance, Valuation & Other Comparisons

While 2025 started on a positive note, Trump’s tariff plans and geopolitical tension resulted in massive volatility, upending bullish investor sentiments. This year, shares of JPMorgan and PNC Financial gained 22.9% and 6%, respectively. 

JPM & PNC YTD Price Performance
 

While JPM outpaced the S&P 500 Index, PNC lagged the broader index. Hence, in terms of investor sentiments, JPMorgan clearly has the edge.

In terms of valuation, JPM is currently trading at a 12-month forward price-to-earnings (P/E) of 14.68X, while PNC stock is currently trading at a 12-month forward P/E of 12.19X. 

P/E F12M
 

Meanwhile, the industry has a 12-month forward P/E of 14.44X. Hence, PNC Financial is trading at a discount compared to the industry and JPM.

JPMorgan’s return on equity (ROE) of 16.93% is above PNC’s 11.07%. Further, the industry’s ROE is 12.06%. This reflects that JPM is more efficiently using shareholder funds to generate profits.

ROE
 

JPM or PNC: Which Lender Deserves a Spot in Your Portfolio?

JPMorgan stands out as a stronger investment option than PNC due to its unmatched scale, diversification and consistent performance. Despite headwinds from expected Fed rate cuts, JPM’s robust loan demand and deposit growth underpin its raised 2025 NII guidance of $95.5 billion. Its leadership in IB, branch expansion strategy and capital return plans further strengthen shareholder value.

In contrast, while PNC is pursuing aggressive expansion and acquisitions, its narrower loan diversification, higher expense base and weaker YTD stock performance highlight JPMorgan’s superior efficiency and investor appeal.

Currently, JPM carries a Zacks Rank #2 (Buy), while PNC has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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