Interest Rates Are Rising Fast: Buy These 5 Big Dividend-Paying Banks Now

JPMorgan

This stock trades at a still reasonable 14.5 times estimated 2021 earnings. JPMorgan Chase & Co. (NYSE: JPM) is one of the leading global financial services firms and one of the largest banking institutions in the United States, with about $2.6 trillion in assets. The company as it is today was formed through the merger of retail bank Chase Manhattan and investment bank J.P. Morgan.

The firm has many operating divisions, including investment and corporate banking, asset management, retail financial services, commercial banking, credit cards and financial transaction services.

Top analysts are very positive on JPMorgan, largely because the industry titan faces a continued broad recovery in nearly every aspect of its business. It has a leading M&A advisory and capital markets product set and market share. It has a massive footprint of corporate and commercial banking customers. And it has a sizable wholesale payments businesses. JPM has proven that it has the wherewithal to continually invest in people, products, and platforms to further its market share base, extending its competitive advantage versus most peers.

Second-quarter profit and revenue exceeded analysts’ expectations. The bank said the improving U.S. economic outlook drove its decision to release money set aside for loan losses, which came mostly from retail credit-card and mortgage reserves.

JPMorgan Chase stock investors receive a 2.41% dividend. Jefferies has a $177 price target, and the consensus target is $168.50. The shares closed at $166.08 on Tuesday.

KeyCorp

This is another top regional player that is very cheap at current levels. KeyCorp (NYSE: KEY) operates as the bank holding company for KeyBank National Association, which provides deposit, lending, cash management and investment services to individuals, small and medium-sized businesses.

The company also provides a broad range of sophisticated corporate and investment banking products, such as merger and acquisition advice, public and private debt and equity, syndications and derivatives to middle market companies in selected industries throughout the United States under the KeyBanc Capital Markets banner.

The stock modestly has outperformed its peers after posting solid second-quarter results with forward guidance relatively unchanged. The bank also successfully rolled out Laurel Road for Doctors, its national digital bank, adding 2,500 new clients.

Investors receive a 3.40% dividend. The $24 Jefferies target price compares with a $22.54 consensus target on KeyCorp stock, as well as Tuesday’s closing share price of $21.75.

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