Jamie Dimon Has Run JPMorgan Chase for 2 Decades. What Happens to the Stock When He Steps Down?
Jamie Dimon is the long-serving CEO of JPMorgan Chase (NYSE: JPM), having taken on the role roughly 20 years ago in 2006. However, given his age (70), he is thinking about retirement. And while Dimon stepping down isn’t imminent, it is likely to happen sooner rather than later. This is something investors should care about, but it shouldn’t leave you deeply worried about the future. Here’s what happens when he steps down.
JPMorgan Chase is already preparing
Chief executive officer succession planning is one of the things that most boards of directors consider very deeply. Unless there is an unusual situation, such as a sudden illness, planning for a CEO’s retirement generally starts well before the actual retirement. Which is why it is important to note that JPMorgan Chase recently promoted Doug Petno and Troy Rohrbaugh to the roles of co-presidents.
Image source: JPMorgan Chase & Co.
There’s no guarantee, but it is highly likely that one of these two will become the next CEO. The promotions are probably intended to give the board a better look at their management skills. And it comes as Dimon is discussing his retirement, which is the big tell. However, for investors, the upshot is that JPMorgan Chase won’t be rudderless or have to rush to find a CEO. It is already preparing for Dimon’s retirement, and the transition is likely to be very smooth as an existing and trusted leader steps into the role.
The CEO sets the tone for the entire company
The next factor to consider is the actual role of a CEO. The job isn’t to micromanage every aspect of a business, which would be nearly impossible with a company the size of financial giant JPMorgan Chase. Instead, a CEO sets a general direction, working with a company’s many leaders to move it toward a bigger goal. Dimon’s biggest job is to set the tone, if you will.
Today’s Change
(-0.70%) $-2.56
Current Price
$360.69
Key Data Points
Market Cap
Day’s Range
$358.23 – $363.05
52wk Range
$279.10 – $366.50
Volume
1.3M
Avg Vol
8.8M
Dividend Yield
1.65%
Given his long tenure at JPMorgan Chase, Dimon has left a major imprint on the business. That includes the two recently promoted employees who might replace him. While any new CEO will operate differently from Dimon, since they aren’t Dimon, the current succession planning playing out hints that the changes will not be massive. Nor are any eventual changes likely to happen quickly, unless the market environment demands rapid and dramatic business shifts.
Similar but different is the likely outcome
While investors may take a wait-and-see attitude when Dimon hands the CEO reins over to his successor, the truth is that not much is likely to change at the company. Dimon’s long and successful tenure at the bank pretty much assures that the next in line will try to keep things running smoothing rather than come in and remake the business. And the promotion of two internal CEO candidates is further evidence that the CEO transition will be a smooth one. Keep an eye on the executive suite, but don’t lose sleep over Dimon’s eventually retirement from JPMorgan Chase.
JPMorgan Chase is an advertising partner of Motley Fool Money. Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.
