JPMorgan Chase & Co.’s (JPM - Free Report) board of directors approved a 4.2% hike in the company’s quarterly common stock dividend. The revised quarterly dividend now comes in at 50 cents per share, compared with the previous figure of 48 cents. The dividend will be paid on Apr 30, 2017, to shareholders of record as of Apr 6.
The company had previously increased its dividend by 9.1% (from 44 cents to 48 cents per share) in May 2016.
Supported by a solid balance sheet position, the company continues to enhance shareholder value through efficient capital deployment activities.
In Jun 2016, subsequent to the clearance of the annual stress test, JPMorgan received approval for its 2016 capital plan that includes buyback of $10.6 billion shares (through the second quarter of 2017) and continued dividend payment. As of Dec 31, 2016, $6 billion worth shares were yet to be repurchased.
Considering JPMorgan’s Mar 21 closing price, the new dividend will yield 2.3%.
Investors interested in this Zacks Rank #3 (Hold) stock can have a look at its fundamentals and growth prospects.
Earnings per Share Growth: JPMorgan’s earnings are projected to increasenearly 6% in 2017 and over 14% in 2018. Also, the company delivered an average positive earnings surprise of 12.2%, in the trailing four quarters.
Valuation: JPMorgan’s stock appears undervalued based on its P/E and P/B ratios. The company has a forward P/E (F1) ratio of 13.73, compared to the industry average of 14.90. Also, its P/B ratio of 1.44 is lower than the industry average of 1.46.
Share Price Movement: JPMorgan’s shares have gained 45.8% in the last one year, compared with 40.7% growth for the Zacks categorized Major Regional Banks industry.
Leverage: JPMorgan’s debt/equity ratio of 1.39 compares with the industry average of 0.86, indicating higher debt level relative to the industry.
Return on Equity (ROE): JPMorgan’s ROE of 9.7%, as compared with the industry average of 8.9%, proves that the company is better placed than its peers.
Some better-ranked stocks in the finance space include Evercore Partners Inc. (EVR - Free Report) , Bank of America Corporation (BAC - Free Report) and Comerica Incorporated (CMA - Free Report) .
Evercore Partners witnessed an upward earnings estimate revision of 6% for the current year, in the last 60 days. Its share price increased 47.9% in the last six months. It currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bank of America carries a Zacks Rank #2 (Buy). For the current year, in the last 60 days, its Zacks Consensus Estimate was revised 1.2% upward. Its share price increased 47.7% in the last six months.
Comerica also carries a Zacks Rank #2. It witnessed an upward earnings estimate revision of 1.7% for the current year, in the last 60 days. Its share price increased 41.4% in the last six months.
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