JPMorgan Chase’s Shareholder Rewards and Dividend Yield




The Federal Reserve approved JPMorgan Chase’s (JPM) capital plans for 2016 after it cleared its annual stress test in June. After the stress test results were released, the bank said it would keep its dividends constant at $0.48 per share but raised its share repurchases to $10.6 billion.

JPMorgan Chase is also expected to pay a special dividend to investors after seeing significant gains in its shares. JPM has boosted its dividend payout annually over the past five years. Wall Street analysts expected the bank to announce a share repurchase plan of ~$8 billion.

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For 3Q16, JPMorgan Chase (JPM) announced dividends of $0.48 per share, 10% higher than its 3Q15 dividends. The company’s dividend yield of 2.9% is one of the highest among banking players, which constitute 48% of the Financial Select Sector SPDR ETF (XLF). During 3Q16, it repurchased $2.1 billion in shares and returned $3.8 billion in capital to its shareholders.

In 2015, the company paid dividends of $1.72 per share and repurchased $4.5 billion in common stock.

Share repurchase plans

JPMorgan Chase (JPM) increased its share repurchase authorization to ~$1.9 billion in March 2016, reflecting the company’s increased confidence in its current valuation as well as its long-term prospects. This is in addition to the company’s share buyback authorization of $6.4 billion in 2015.

Other banks returning capital to shareholders by repurchasing their shares include Bank of America (BAC), Capital One Financial (COF), and Wells Fargo (WFC)


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