JPMorgan Chase & Co. (JPM) reports fourth-quarter earnings Tuesday morning, and it's not just another quarterly report. This one matters because it kicks off bank earnings season at a moment when the entire industry might be shifting gears.

The big question: Can investment banking and dealmaking replace the easy money banks have been making from higher interest rates?

The Dealmaking Story Takes Center Stage

"The story for 2026 is really going to be about deal-making," said Alexis Garcia, Senior Editor at Investor's Business Daily, speaking on IBD's Earnings Cheat Sheet podcast Friday. Investment banking and trading revenue will be the key highlight, she noted.

Garcia pointed to SpaceX's rumored $1.5 trillion IPO this year, along with other long-awaited tech offerings. "Analysts and investors are really going to be looking for clues to see perhaps how JP Morgan is positioning itself for these massive offerings," she explained.

Ed Carson, News Editor at Investor's Business Daily and podcast co-host, emphasized that JPMorgan has consistently outperformed regional banks precisely because of its strength in investment banking, M&A, and equity issuance. As a money center bank, it's built differently.

But here's the challenge: Carson expects earnings growth to slow in 2026 because of interest rate cuts. The focus now shifts to whether major banks can reignite momentum through deal flow and equity underwriting.

There's reason for optimism. During third-quarter results three months ago, JPMorgan CFO Jeremy Barnum said the company had its "busiest summer" for dealmaking in a long time and expected that momentum to continue into Q4 and beyond.

Valuation Story: Banks Look Cheap

BofA Securities analyst Ebrahim H. Poonawala recently bumped JPMorgan's price target to $362 from $350, representing 11% upside from current levels, while maintaining a "Buy" rating. According to Poonawala, the stock undervalues the company's market and tech leadership, strong profitability, and solid capital position. He forecasts $95 billion in core net interest income and 6% year-over-year revenue growth for 2026.

TV host Jim Cramer took a broader view, saying "the banks are all cheap" in a post on X last month. He's not wrong about the valuation gap.

JPMorgan currently trades at 15.46 times forward earnings and 5.09 times sales. Compare that to the SPDR S&P 500 ETF (SPY), which tracks the broader market at a P/E ratio of 28.15. That's a significant discount.

Shares of JPMorgan Chase closed down 1.43% Monday at $324.49 and were up 0.07% in overnight trading. The stock scores poorly on Momentum and Growth in market rankings but shows favorable price trends in both short and long terms.

So when JPMorgan reports Tuesday morning, investors won't just be looking at one quarter's numbers. They'll be trying to figure out what 2026 looks like for the entire banking sector when the old playbook stops working quite as well.