How JPMorgan Chase’s Dividend Yield Has Performed
Revenue and EPS of JPMorgan Chase
JPMorgan Chase (JPM) recorded 2.3% net revenue growth in 2016 after -2% in 2015. The 2015 results were due to a decline in consumer & community banking and corporate & investment bank, which was offset by flat growth posted by the commercial banking and asset & wealth management segments. While 2016 recorded growth in consumer & community banking, corporate & investment banking, and commercial banking, while asset & wealth management posted flat growth. The 5% 1H17 revenue growth was driven by corporate & investment bank, commercial banking, and asset & wealth management offset by consumer & community banking.
EPS rose 3.2% in 2016 after rising 13.4% in 2015. This was due to high interest expense in 2016 offset by lower non-interest expense and share buybacks. EPS recorded 20% growth in 1H17 despite the higher non-interest expense. The growth has also been supported by share buybacks. The company has a very good free cash flow balance.
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Dividend trajectory of JPMorgan Chase
We can see the downward sloping dividend yield curve of JPMorgan Chase despite the increase in dividend per share. This is due to the rising prices of the company negating the effect of the dividend increase. JPMorgan Chase has a dividend yield of 2.3% and price gains of 11.7%. This compares to a dividend yield of 2.3% and YTD price gains of 14.7% by the Dow Jones Industrial Average (DJIA-INDEX) (DIA). The S&P 500 (SPX-INDEX) (SPY) has a dividend yield of 2.4% and YTD price gains of 13.3%. The NASDAQ Composite (COMP-INDEX) (ONEQ) has YTD price gains of 21.4%.
The FlexShares Quality Dividend Dynamic Index Fund (QDYN) is a dividend ETF with exposure to JPMorgan Chase. The ETF has a dividend yield of 2.7% and a PE of 21.1x. The Vanguard High Dividend Yield ETF (VYM) is a dividend ETF with exposure to JPMorgan Chase. The ETF has a dividend yield of 3% and a PE of 21.6x.