Jim Cramer Keeps Arguing JPMorgan and Wells Fargo Are Trading Too Cheap
Jim Cramer has spent much of 2026 circling back to the same frustration: JPMorgan Chase & Co. (NYSE:JPM) and Wells Fargo & Company (NYSE:WFC) are not being rewarded the way their fundamentals suggest they should be.
On the 17th, the CNBC host returned to the subject, reiterating his longstanding view that both banks' earnings multiples remain too low. For JPMorgan, Cramer has argued repeatedly that the price-to-earnings ratio fails to reflect the strength of the bank's balance sheet and earnings power. For Wells Fargo, he believes the turnaround strategy led by CEO Charlie Scharf has not yet translated into a healthy multiple.
Wells Fargo's story changed significantly after the Federal Reserve removed the bank's asset cap in June 2025. That cap had held assets below the $1.95 trillion threshold and limited the bank's ability to grow. Scharf has since focused on corporate and investment banking, with several seasoned executives joining the effort.
The strategy is starting to show up in results. In the second quarter, Wells Fargo's loans grew 12% year over year to $1 trillion. Investment banking fees jumped 35% to $939 million, and markets revenue rose 24% to $2.2 billion. Those figures help explain why Cramer continues to express optimism about the bank.
Still, the bank's past continues to haunt it. Second-quarter personnel costs climbed to $8 billion as Wells Fargo maintained its compliance and risk-assessment teams. And when markets revenue is excluded, net interest income grew just 2%, highlighting the lingering impact of deposit betas and yield curve shifts.
JPMorgan's latest quarter gives Cramer a different set of numbers to work with. The bank grew net income to $21 billion in the second quarter, up from $14.9 billion a year earlier. Even after stripping out one-time items—including a $1 billion investment gain and a $4.6 billion gain related to Visa—net income came to $16.9 billion. Its markets revenue climbed 35% and investment banking fees rose 30%, matching Wells Fargo's momentum on Wall Street.
JPMorgan also continues to benefit from its scale. Wealth management assets under management grew 18% to $5.1 trillion. But growth has costs: noninterest expenses increased 15%, and net interest income excluding markets rose only 4%. That number, while modest, still outpaced Wells Fargo. On the consumer side, the bank set aside $2.1 billion in loan loss provisions, a reminder that the credit environment remains tight.
Institutional investors have taken note of JPMorgan's position. Insider Monkey data showed 131 of 1,022 hedge funds tracked held a stake in JPMorgan in the first quarter, compared with 82 funds for Wells Fargo. On valuation, Wells Fargo trades at a forward P/E ratio of 11.71, below JPMorgan's 14.79. Short interest is negligible for both.
The core of Cramer's argument is the disconnect between what these banks have accomplished and the multiples the market assigns to them. Whether that gap narrows is an open question, but for Cramer, the numbers are clear enough.
Read Next:Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First and Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out.
Disclosure: None.