Digital Banking: AI Defensibility Underappreciated; QTWO Top-Pick, ALKT High-Conviction Take-Out Candidate, More Constructive on NCNO

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Digital Banking: AI Defensibility Underappreciated; QTWO Top-Pick, ALKT High-Conviction Take-Out Candidate, More Constructive on NCNO

J P M O R G A N North America Equity Research

22 June 2026

Digital Banking

AI Defensibility Underappreciated; QTWO Top-Pick,

ALKT High-Conviction Take-Out Candidate, More

Constructive on NCNO

We are rolling forward our valuation framework to Dec-27 across our banking Vertical SaaS & HealthTech

ACtechnology/digital banking coverage and come away with a constructive view on Ella Smith

the group, whereby AI-defensibility concerns appear overstated relative to the (1-212) 622-2451

entrenched workflow, data, and compliance moats these vendors have built. Our ella.smith@jpmchase.com

highest-conviction ideas remain Q2 (QTWO) and Alkami (ALKT), both Alexei Gogolev

Overweight, which operate in a consolidated, duopolistic digital banking market (1-212) 622-9391

with long contract durations, strong gross retention, and clear pathways to alexei.gogolev@jpmorgan.com

meaningful margin and FCF expansion—characteristics we believe should Destiny Jackson

command premium multiples in a fundamentals-driven tape. ALKT screens as our (1-212) 622-4360

destiny.jackson@jpmorgan.com

high-conviction takeout candidate amid renewed activist pressure and supportive

Isabella A Camajownership dynamics, while QTWO offers the cleaner organic compounding story

(1-212) 834-2379

with a large underpenetrated TAM and conservative capital allocation. On nCino bella.camaj@jpmorgan.com

(NCNO), we maintain our Neutral rating given a less consolidated end market and J.P. Morgan Securities LLC

a comparatively less crystallized AI narrative, but following this week’s

headquarters visit (see detailed notes here) we are incrementally more positive on