- Ignore macro concerns, say David Kostin and team at Goldman, noting a number of reasons making the sector a buy: 1) Jump in capital returns this year 2) Higher ROEs and P/B ratios 3) Valuations still at a discount 4) Deregulation move picking up steam.
- Investment pros, says Kostin, continue to be underweight the sector, with the top 25 equity income funds holding just a 19% weighting - 700 basis points less than the common benchmark.
- Baird's David George, on the other hand, takes note of the BKX's 29% advance since the November election vs. the S&P's 16%. As for the benefit of higher capital returns and interest rates, one could make the case those catalysts have been fully baked in by now.
- ETFs: XLF, FAS, FAZ, KRE, VFH, UYG, KBE, IYF, FNCL, BTO, IAT, IYG, KBWB, QABA, FXO, SEF, KBWR, RYF, FINU, XLFS, DPST, KRU, FINZ, RWW, WDRW, KRS, FAZZ, JHMF, FTXO, FNCF
- Now read: An Update On The U.S. Credit Cycle
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