Markets mixed as US hits record highs amid ceasefire extension

Analyst thesis

Our recommendation is based on:

• Nestlé has a wide range of products with a strong brand and market position across multiple geographical regions.

• Higher inflation input costs have been shown to be partially passed on to consumers through pricing.

• Organic growth has primarily been driven by pricing, with volumes remaining subdued.

• Valuations appear attractive on a P:E and EV/EBITDA basis, but current risks to margins, earnings and organic growth limit upside potential.

Analyst thesis

Our recommendation is based on:

• JPM operates across Consumer & Community Banking, Corporate & Investment Banking, Commercial Banking and Asset & Wealth Management, providing diversified revenue streams across US retail, wholesale and global markets with selective international exposure. The portfolio generates a mix of recurring and market-sensitive income, captures higher-margin capital markets and advisory opportunities, and provides exposure to both secured and unsecured lending, supporting earnings durability across varying economic and rate environments.

• Under Jamie Dimon, JPM leverages digital banking and AI, supported by a large mobile user base and automation, to drive client acquisition, engagement and operating leverage. Rising digital penetration supports a durable cost and risk advantage over peers.

• JPMorgan Chase & Co. delivers sector-leading profitability, consistently generating double-digit ROE/ROTCE alongside robust capital and liquidity. Strong capital generation supports sustained investment, dividends and buybacks, underpinned by scale and funding advantages.

• Solid fundamentals but valuation constrains upside: Despite strong leverage to the United States, the stock trades at a premium to peers, with its quality largely priced in. As sector valuations appear modestly stretched and earnings tailwinds normalise, risk-reward profile looks balanced, supporting a hold stance.

Analyst thesis

Our recommendation is based on:

• B2B digital services: DTE is growing its high-margin business‑customer segment by offering 5G private networks, secure connectivity (SD-WAN) and sovereign cloud services to a range of companies and public institutions, with strong demand from factories, ports and logistics hubs.

• T-Mobile US market share expansion: T‑Mobile US has transitioned from a low‑cost challenger to the best‑in‑class network, supporting a mix shift toward higher‑quality, prime subscribers while continuing to expand into under‑penetrated rural America.

• German fibre monetisation (FTTH): The decade‑long copper-to-FTTH migration acts as a structural value driver, boosting ARPU through higher‑speed tiers and convergent bundles, while progressively reducing network maintenance and fault‑repair OpEx.

• Disciplined capital allocation: While European peers remain constrained by leverage and higher interest rates, DTE is returning ~€2 billion annually via buybacks and steadily increasing its TMUS stake from 50.6% to 52.8%, enhancing exposure to US growth without compromising balance sheet resilience.

• Artificial intelligence (AI) and data centre optionality: Strategic partnerships with NVIDIA and Brookfield to build sovereign AI compute infrastructure in Germany provide medium-term upside optionality as European enterprises and governments seek local, secure AI cloud capacity.