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JPM on tape with big buyback


dcollon
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JPMorgan Chase to Increase Quarterly Common Stock Dividend to $0.30 Per Share

Tuesday, March 13, 2012 03:04:00 PM

 

 

JPMorgan Chase & Co. (NYSE: JPM) today announced the following actions taken by its Board of Directors:

 

Declared a quarterly dividend of $0.30 per share on the corporation's common stock, an increase of $0.05 per share. The dividend is payable on April 30, 2012 to stockholders of record at the close of business on April 5, 2012

Authorized a new $15 billion equity repurchase program, of which up to $12 billion is approved for 2012 and up to an additional $3 billion is approved through the end of the first quarter of 2013

Remarking on the dividend action and repurchase authorization, Jamie Dimon, Chairman and CEO, said, "We are pleased to be in a position to increase our dividend and to establish a new equity repurchase program. We expect to generate significant capital and deploy that capital to the benefit of our shareholders. JPMorgan Chase continues to invest in our substantial organic growth opportunities as our top priority and best use of capital. We expect to repurchase, at a minimum, approximately the same amount of shares that we issue for employee stock-based incentive awards. Beyond this, we intend to repurchase equity only when we are generating capital in excess of what we need to fund our organic growth and when we think it provides excellent value to our existing shareholders."

 

The Federal Reserve has informed the Firm that it completed its 2012 Comprehensive Capital Analysis and Review (“CCAR”) and that it did not object to the Firm’s proposed capital distributions submitted pursuant to CCAR.

 

The timing and exact amount of common stock and warrant purchases will be consistent with the Firm’s capital plan and will depend on various factors, including market conditions, the Firm's capital position, internal capital generation, and organic investment opportunities. The new repurchase program does not include specific price targets, may be executed through open market purchases or privately negotiated transactions, including utilizing Rule 10b5-1 programs, and may be suspended at any time. The equity repurchase program replaces the prior $15 billion program that had approximately $6.05 billion of remaining authorization.

 

 

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

Looks like WFC payout ratio is 8% lower, so the dividend increase will likely be more for WFC.

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

You have double taxation on a dividend, which was already at about 2.5% annually.  Whereas a share buyback is much more tax efficient if you believe your shares are undervalued, and your business will do well economically long-term.  Cheers!

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

You have double taxation on a dividend, which was already at about 2.5% annually.  Whereas a share buyback is much more tax efficient if you believe your shares are undervalued, and your business will do well economically long-term.  Cheers!

 

Oh, absolutely, I just wanted both.  :P. 

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

Looks like WFC payout ratio is 8% lower, so the dividend increase will likely be more for WFC.

 

Did WFC release payout information?

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

Looks like WFC payout ratio is 8% lower, so the dividend increase will likely be more for WFC.

 

Did WFC release payout information?

 

I would bet that WFC's dividend will be a minimum of 60 cents, and I would say it would be closer to 80 cents annually.  They could actually afford even more than that, but I think they may back a bunch of shares too.  Cheers!

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

Looks like WFC payout ratio is 8% lower, so the dividend increase will likely be more for WFC.

 

Did WFC release payout information?

 

No, sorry, I was looking at prior payout ratio differences to see what the dividend increase for a comparable ratio for WFC (based on the new JPM ratio) would be.  In conclusion, more than a 20% increase for WFC if they have a similar payout ratio for JPM (just speculating).

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Only a dividend increase of 20%--I was expected more like 30-50% for WFC and thought they were in similar boats.  That's a lot of buyback though.

 

Looks like WFC payout ratio is 8% lower, so the dividend increase will likely be more for WFC.

 

Did WFC release payout information?

 

I would bet that WFC's dividend will be a minimum of 60 cents, and I would say it would be closer to 80 cents annually.  They could actually afford even more than that, but I think they may back a bunch of shares too.  Cheers!

 

That would be 25%-67% increase, in line with what I was thinking as well.

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