Understanding JPMorgan Chase & Co's Dividend Sustainability and Growth
JPMorgan Chase & Co (JPM, Financial) recently announced a dividend of $1.05 per share, payable on 2024-01-31, with the ex-dividend date set for 2024-01-04. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into JPMorgan Chase & Co's dividend performance and assess its sustainability.
What Does JPMorgan Chase & Co Do?
JPMorgan Chase is one of the largest and most complex financial institutions in the United States, with nearly $4 trillion in assets. It operates across four major segments: consumer and community banking, corporate and investment banking, commercial banking, and asset and wealth management. With operations and regulatory compliance in multiple countries, JPMorgan Chase & Co is a global banking powerhouse.
A Glimpse at JPMorgan Chase & Co's Dividend History
JPMorgan Chase & Co has maintained a consistent dividend payment record since 1985, distributing dividends quarterly. The company has increased its dividend each year since 2009, earning the title of a dividend achiever. This distinction is reserved for companies with at least 15 consecutive years of dividend increases.
Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down JPMorgan Chase & Co's Dividend Yield and Growth
JPMorgan Chase & Co currently has a 12-month trailing dividend yield of 2.37% and a 12-month forward dividend yield of 2.46%, indicating an expected increase in dividend payments over the next year. Over the past three years, the annual dividend growth rate was 5.60%, which expanded to 12.90% over a five-year period. The past decade has seen an annual dividends per share growth rate of 13.70%.
Considering JPMorgan Chase & Co's dividend yield and five-year growth rate, the 5-year yield on cost for the stock is approximately 4.35%.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio is crucial for assessing dividend sustainability. JPMorgan Chase & Co's ratio is 0.24 as of 2023-09-30, suggesting a well-balanced approach between distributing earnings and retaining funds for future growth and stability. The company's profitability rank is 6 out of 10, indicating fair profitability. A consistent track record of positive net income over the past decade underscores its financial health.
Growth Metrics: The Future Outlook
A company's growth metrics are vital for dividend sustainability. JPMorgan Chase & Co's growth rank of 6 out of 10 reflects a fair growth outlook. Its revenue per share and 3-year revenue growth rate of approximately 6.50% per year signal a strong revenue model, outperforming about 51.43% of global competitors. The 3-year EPS growth rate of about 4.10% per year and a 5-year EBITDA growth rate of 14.30% further demonstrate the company's growth capabilities, outperforming 34.6% and 70.66% of global competitors, respectively.
Next Steps
Considering JPMorgan Chase & Co's consistent dividend payments, robust dividend growth rate, prudent payout ratio, and solid profitability and growth metrics, the company presents a compelling case for investors seeking stable dividend income. As the financial landscape evolves, it will be essential for investors to monitor these factors to ensure the ongoing reliability of their investment. For those interested in exploring further, GuruFocus Premium offers tools like the High Dividend Yield Screener to discover high-dividend yield stocks.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
