These Banks Stocks Are Treating Investors Very Well

Andy Snyder|July 1, 2021

Oh boy… look at all that easy money.

We sure hope you followed our advice. Banks are handing out money everywhere we look.

Just as we predicted, the Federal Reserve gave the nation’s banks a big thumbs-up. If the system crashed tomorrow… the banks would have plenty of cash to get them through.

That’s the good thing about printing $4 trillion in a few months’ time. It makes banking easy.

It makes investing in banks even easier.

The folks who followed our recent advice will get their share of an extra $2 billion in bank industry dividends next quarter.

Morgan Stanley (MS) doubled its payout to $0.70 per share.

Goldman Sachs (GS) boosted its dividend from $1.25 to $2.00.

JP Morgan Chase (JPM) added a dime to its payout, taking it to a buck a share. Bank of America (BAC) added $0.03, taking its quarterly payout to $0.21. And Wells Fargo (WFC) doubled its cash distribution to $0.20 per share.

That’s a lot of money going back to shareholders.

But, as we promised it would, the story gets even better…

Less Is More

Right now, there are two kinds of companies – those that are diluting their investors by offloading shares at these record-high prices… and those that are rewarding their investors by using the free-money bonanza to buy back shares.

The nation’s banks used last week’s good report from the Fed to move squarely into the latter category.

Morgan Stanley added $2 billion to its buyback program.

Wells Fargo says it will start buying back $18 billion worth of shares as soon as the third quarter.

JPMorgan Chase is grabbing $30 billion worth, and Bank of America will repurchase $25 billion worth.

Add it all up, and the action is treating investors quite well. So far this year, the SPDR S&P Bank ETF (KBE) has outpaced the broad market by 50%… with a healthy dividend that’s only going to grow from here.

So how do you play this trend?

It’s quite simple. Buy the banks that are rewarding shareholders the most. They’re not hard to find.

Screen the industry for things like dividend yield, payout ratio and long-term dividend trends (in that order).

Use the link we sent you yesterday to see if a bank is diluting its shares or pulling them off the market.

Here’s what Bank of America has done over the last five years…

The $350 billion bank has bought back more than 2 million of its shares. It’s a move that has treated shareholders well. The stock is up 185% during the period… more than double the return of the broad market.

Banks are a smart place to invest right now.

They’re flush with cash. They’re rewarding shareholders with it. And they’re outpacing the market with very little additional volatility or risk.

They won’t make you rich overnight, but give them time, and they’ll treat you very nicely… especially at today’s prices.

P.S. For a more volatile play on the banking sector – one that just might make you rich a lot faster – check out our latest presentation on the crypto market. Digital money is doing big things… fast. Click here.