JPMorgan Chase & Co.'s (NYSE:JPM) investors are due to receive a payment of $1.15 per share on 31st of July. This takes the annual payment to 2.3% of the current stock price, which unfortunately is below what the industry is paying.
View our latest analysis for JPMorgan Chase
JPMorgan Chase's Dividend Forecasted To Be Well Covered By Earnings
While yield is important, another factor to consider about a company's dividend is whether the current payout levels are feasible.
JPMorgan Chase has a long history of paying out dividends, with its current track record at a minimum of 10 years. Based on JPMorgan Chase's last earnings report, the payout ratio is at a decent 26%, meaning that the company is able to pay out its dividend with a bit of room to spare.
The next 3 years are set to see EPS grow by 5.0%. Analysts forecast the future payout ratio could be 30% over the same time horizon, which is a number we think the company can maintain.
JPMorgan Chase Has A Solid Track Record
Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2014, the annual payment back then was $1.52, compared to the most recent full-year payment of $4.60. This implies that the company grew its distributions at a yearly rate of about 12% over that duration. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.
The Dividend Looks Likely To Grow
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. We are encouraged to see that JPMorgan Chase has grown earnings per share at 13% per year over the past five years. JPMorgan Chase definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
JPMorgan Chase Looks Like A Great Dividend Stock
In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. Earnings are easily covering distributions, and the company is generating plenty of cash. Taking this all into consideration, this looks like it could be a good dividend opportunity.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. To that end, JPMorgan Chase has 2 warning signs (and 1 which is significant) we think you should know about. Is JPMorgan Chase not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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About NYSE:JPM
Flawless balance sheet established dividend payer.
