Top Bank Stock Picks For 2024: 'Valuations Are At 50% Discount To S&P 500,' Analysts Say
Portfolio Pulse from Piero Cingari
Bank of America analysts are bullish on U.S. banking stocks for 2024, citing a potential soft landing for the economy, lower interest rates, and attractive valuations. The Financial Select Sector SPDR Fund (XLF) and the SPDR S&P Regional Banking ETF (KRE) both saw a 1% increase after the note. Bank of America highlighted several banks with 'Buy' ratings and provided new price objectives, upgrading Truist Financial Corporation (TFC) and emphasizing regional banks like US Bancorp (USB) and KeyCorp (KEY) among others.
January 04, 2024 | 7:11 pm
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KeyCorp (KEY) is expected to see margin expansion and benefit from a rebound in investment banking, making it a top pick with a 'Buy' rating and a new price objective of $18.00.
The positive sentiment from Bank of America towards KEY, due to expected margin expansion and investment banking rebound, suggests a favorable short-term impact on the stock.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 85
POSITIVE IMPACT
The SPDR S&P Regional Banking ETF (KRE) also increased by 1% and has risen 35% since late October 2023, reflecting optimism in regional banking stocks.
KRE's performance is buoyed by the same factors affecting XLF, with a particular focus on regional banks, which Bank of America analysts are bullish on.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Truist Financial Corporation (TFC) was upgraded to 'Buy' by Bank of America, with a new price objective of $43.00, due to a strong balance sheet and management focus.
The upgrade of TFC to 'Buy' and the new price objective suggest a positive short-term outlook for the stock, as the bank is expected to benefit from the economic conditions outlined by the analysts.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 90
POSITIVE IMPACT
US Bancorp (USB) is favored by Bank of America for its deal-driven synergies and distinct payments business, indicating potential for stock appreciation.
Bank of America's positive outlook on USB, due to its unique business advantages, suggests that the stock may see short-term gains.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 85
POSITIVE IMPACT
The Financial Select Sector SPDR Fund (XLF) rose by 1% following Bank of America's bullish note on banking stocks, indicating positive market sentiment.
The XLF's increase is directly related to the positive outlook from Bank of America's analysts, suggesting a short-term positive impact on the ETF's price.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80