A value stock is generally a company that trades at a price lower than its fundamental value or what its performance suggests it should be worth. Typically, these are shares of a company with solid fundamentals that are priced below those of its peers, based on an analysis of the price-to-earnings ratio, yield, price-to-book value, and other relevant factors. Value stocks are often overlooked by the market or undervalued due to factors such as market volatility, economic downturns, or negative news surrounding the company, which may be temporary in nature. Now, after a massive surge in the stock market for almost three years, J.P. Morgan expects GDP growth to slow in the fourth quarter and early 2026, and it may be time for value to take the lead.
J.P. Morgan projects that U.S. GDP growth will slow significantly, decreasing to just a 1.2% annualized rate in the fourth quarter of 2025 and the first quarter of 2026. This is almost half the rate of the solid growth seen earlier in 2025. In addition, they feel that much of the slowdown is due to the potential impact of the U.S. tariffs, which are plagued by uncertainty and seemingly constant changes and adjustments. In June, the J.P. Morgan economic team warned of a “stagflationary” slowdown caused by tariffs, estimating they could act as a $430 billion tax hike on U.S. households and businesses.
We screened the J.P. Morgan equity research database, looking for value ideas that also offered growth and income investors big and reliable dividends. All are rated Overweight by the firm.
Why do we recommend JP Morgan’s dividend value stocks?
J.P. Morgan is one of the acknowledged leaders in the investment landscape on Wall Street and worldwide. The firm’s top-notch research department continues to provide institutional and high-net-worth clients with the best ideas across the investment spectrum and is likely to do so for years to come.
Entergy
Entergy Corp. (NYSE: ETR | ETR Price Prediction) is an energy company engaged primarily in electric power production and retail distribution operations in the Deep South of the United States. This top utility stock always makes sense for conservative investors and pays a rich 2.71% dividend. Together with its subsidiaries, Entergy produces and distributes electricity in the United States.
It operates in two segments:
- Utility
- Entergy Wholesale Commodities
The Utility segment generates, transmits, distributes, and sells electric power in portions of:
- Arkansas
- Louisiana
- Mississippi
- Texas
- City of New Orleans
The company also distributes natural gas.
The Entergy Wholesale Commodities segment is involved in:
- The ownership, operation, and decommissioning of nuclear power plants located in the northern United States
- Sale of electric power to wholesale customers
- Provision of services to other nuclear power plant owners
- Ownership of interests in non-nuclear power plants that sell electric power to wholesale customers
The company generates electricity from various sources, including gas, nuclear, coal, hydro, and solar. It sells energy to retail power providers, utilities, electric power co-operatives, power trading organizations, and other power generation companies.
Its power plants have approximately 24,000 megawatts (MW) of electric generating capacity, which includes 5,000 MW of nuclear power.
The company delivers electricity to 3 million utility customers in Arkansas, Louisiana, Mississippi, and Texas.
The J.P. Morgan price target for the shares is $103.
Merck
Merck & Co. Inc. (NYSE: MRK) develops and produces medicines, vaccines, biological therapies, and animal health products. Merck is not just a healthcare company but a global force in the industry. This healthcare giant is a no-brainer down over 30% over the past year while paying a solid 3.90% dividend.
The company operates through two segments:
- Pharmaceutical
- Animal Health
The Pharmaceutical segment offers human health pharmaceutical products in:
- Oncology
- Hospital acute care
- Immunology
- Neuroscience
- Virology
- Cardiovascular
- Diabetes
- Vaccine products, such as preventive pediatric, adolescent, and adult vaccines
The Animal Health segment discovers, develops, manufactures, and markets veterinary pharmaceuticals, vaccines, health management solutions and services, as well as digitally connected identification, traceability, and monitoring products.
Merck serves:
- Drug wholesalers
- Retailers
- Hospitals
- Government agencies
- Managed healthcare providers, such as health maintenance organizations
- Pharmacy benefit managers and other institutions
- Physicians
- Physician distributors
- Veterinarians
- Animal producers
Merck’s growth is a result of its efforts and strategic collaborations. The company works with AstraZeneca, Bayer, Eisai, Ridgeback Biotherapeutics, and Gilead Sciences to jointly develop and commercialize long-acting treatments for HIV, demonstrating a commitment to innovation and growth.
The J.P. Morgan target price is at $120.
NextEra Energy
In what has been a big year for utility stocks, this company has lagged and offers investors an incredible entry point and a solid 3.04% dividend. NextEra Energy Inc. (NYSE: NEE) is an electric power and energy infrastructure company. It operates through its wholly owned subsidiaries, NextEra Energy Resources and NextEra Energy Transmission (collectively, NEER) and Florida Power & Light Company (FPL).
The FPL segment is a rate-regulated electric utility engaged in the generation, transmission, distribution and sale of electric energy in Florida. FPL has approximately 35,052 megawatts of net generating capacity, over 91,000 circuit miles of transmission and distribution lines and 921 substations.
The NEER segment owns, develops, constructs, manages, and operates electric generation facilities in wholesale energy markets in the United States and Canada and includes assets and investments in other businesses with a clean energy focus, such as battery storage, natural gas pipelines, and renewable fuels.
NextEra Energy owns, develops, constructs and operates rate-regulated transmission facilities in North America.
J.P. Morgan has set an $87 target price for the shares.
Regency Centers
With a solid dividend near 4% and a strong triple net lease portfolio, this is an outstanding REIT to look at now. Regency Centers Corp. (NASDAQ: REG) is a real estate investment trust based in Jacksonville, Florida, and it is one of the largest shopping center operators. Regency Centers is a preeminent national owner, operator, and developer of shopping centers in suburban trade areas with compelling demographics.
The company’s portfolio includes thriving properties merchandised with highly productive:
- Grocers
- Restaurants
- Service providers
- Best-in-class retailers that connect to their neighborhoods, communities, and customers
The company raised the shareholder dividend by 5.2% in December of 2024. That marked the 11th year in a row for a dividend increase. The company has steadily lifted its dividend since 2014.
Operating as a fully integrated real estate company, Regency Centers is a qualified REIT that is self-administered and self-managed and a member of the S&P 500 Index.
J.P. Morgan’s target price for the shares is $82.
Valley National Bancorp
With a long history and a very reliable 4.02% dividend, this is an outstanding financial sector idea, which should continue to do well in a falling interest rate environment. Valley National Bancorp (NASDAQ: VLY) is a bank holding company and a financial holding company.
The company’s principal subsidiary is Valley National Bank. Its segments include:
- Consumer Banking
- Commercial Banking and Treasury
- Corporate
The Consumer Banking comprises residential mortgages and automobile loans, and to a lesser extent, secured personal lines of credit, home equity loans and other consumer loans.
Consumer Banking also includes:
- Wealth management and insurance services
- Asset management advisory
- Brokerage
- Trust
- Personal and title insurance
- Tax credit advisory services
- International and domestic private banking businesses
The Commercial Banking comprises floating rate and adjustable rate commercial and industrial loans and construction loans, and adjustable and fixed-rate owner-occupied and commercial real estate loans. It also offers niche financial services, including loan and deposit products for homeowners’ associations and others.
J.P. Morgan has an $11 price target, which should be moved higher soon.
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