JPMorgan's higher second-quarter earnings are good news for other brokers, which had been guiding expectations lower, Paul Miller, FBR Capital Markets managing director, told CNBC Thursday.
"This is really good for the Goldman Sachsesand Morgan Stanleysof the world," he said of the JPMorgan results. "I think what is going on right now is the broker-dealer side is carrying the day" over the banking side.
(Not every analyst shares that view, as you can see here.)
JPMorgan on Thursday reported higher second-quarter profits, boosted by lower costs for bad loans.
Miller, who is long on JPMorgan and its chairman, Jamie Dimon, said he was "excited" by the company's results. "It seems that Jamie Dimon and JPMorgan can go through the headwinds and come out looking good," Miller said.
But on the banking side, things aren't as bright. Miller said low interest rates "are still weighing on these [banking] companies and their stocks." JPMorgan's investment bank had a good quarter thanks to trading and underwriting fees, but "mortgages continue to be an area of focus," he said.
Mortgage originations "are going to be down this year," he added. "We're not going to have a good enough quarter in [the] mortgage bank as we did last year but it's still going to help going forward."
JPMorgan has set aside reserves to cover mortgage-related expenses and litgation, and to Miller that means "you're going to see better performance out of that department going forward."
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Neither Paul Miller nor his firm own shares of JPM.