JPMorgan Chase (NYSE:JPM) stock is up 23% in 2021, nearly doubling the S&P 500’s 14% gain.

But it’s still dirt cheap, especially compared with the fintechs it’s trying to catch as if they were Pokemon.

America’s biggest bank has made OpenInvest its third fintech acquisition of the year, joining 55ip and Nutmeg in the portfolio.

OpenInvest helps bankers customize client portfolios around their personal values, not just financial values. Nutmeg is an English wealth manager, while 55ip automates the construction of “tax-efficient” portfolios.

There’s a theme here, which is defending JPMorgan’s position in handling money for wealthy people. Automation will keep those costs down leaving bankers free to schmooze the clients.

A Closer Look at JPM Stock

Watching big banks gobble up fintechs is a bit like watching International Business Machines (NYSE:IBM) try to grab early-stage tech companies. The acquirer is looking for excitement while the acquired is looking to cash out.

There are so many fintechs, automating so many areas of finance and money management, that big banks like JPMorganChase can’t possibly catch them all. This is weighing on the big banks’ stocks, which while advancing remain undervalued.

At about $156, JPM stock is selling at just 12.6 times last year’s earnings, and its 90 cent per share dividend yields 2.3%.

That dividend is going to $1/share in the third quarter after its books easily passed the latest Dodd-Frank “stress test.” Passing gave banks a green light for bigger dividends and stock buybacks.

But JPM stock has barely budged from where it was before the tests. This despite the dividend hike bringing the yield to 2.5%, well above the 2.06% rate on the 30-year bond.

Look Beyond Dimon

While JPMorgan Chase has been buying fintechs serving the class market, Dimon has set up a succession battle focused on the mass market.

Marianne Lake and Jennifer Piepszak are in the hunt for the top spot after being made co-heads of the bank’s consumer finance unit.

It may all be a fake-out, however. Dimon says he’s staying another five years, and the industry may be completely transformed in that time.

By 2026 a lot of the junior bankers now taking $100,000 paychecks to start at the bank may have hit the street. There are fewer people working in commercial banking in 2021 than there were in 2011. The decline has accelerated this year.

That’s because fintechs like SoFi (NASDAQ:SOFI) are making bank branches obsolete. I haven’t been in one for years, except to visit the documents in my safety deposit box.

When checks come in, I deposit them with my phone. I stopped taking out cash during the pandemic and might not go back to it.

So in addition to automating wealth management, JPMorgan is investing in companies that automate mortgage origination and looking for international growth.

Dimon has also been hoarding cash, warning against higher interest rates. 

The Bottom Line

A bank’s traditional job is to sell money for more than it paid for it. They do it by borrowing at short-term rates and selling at long-term rates.

That’s changing as automation crushes spreads.

Dimon says he wants his people back in the office, but the trend is clear. Office work is disappearing.

Analysts and programmers can easily work from home. Bankers should be like detectives, calling on clients instead of sitting at desks eating donuts.

JPMorgan Chase stock remains something you can build a portfolio off. It’s cheap, relative to the market, and it pays a dividend.

It’s no longer where the action is, not even in finance, so don’t expect a huge pop.

On the date of publication, Dana Blankenhorn did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Dana Blankenhorn has been a financial and technology journalist since 1978. He is the author of Technology’s Big Bang: Yesterday, Today and Tomorrow with Moore’s Law, available at the Amazon Kindle store. Write him at danablankenhorn@gmail.com or tweet him at @danablankenhorn. He writes a Substack newsletter, Facing the Future, which covers technology, markets, and politics.