Financial stocks include a wide array of businesses operating in the financial sector. Banks, lenders, insurance, payment networks, financial services, mortgage REITs, blockchain and cryptocurrency offerings, FinTech stocks, and even SPACs come under this umbrella.
Finance is at the heart of the stock market, which gives further scope for an investment opportunity. There are also several financial-themed exchange-traded funds (ETFs) for those wary of investing in individual finance stocks.
Financial stocks tend to thrive in sync when the economy is thriving, but a declining financial sector can signify a struggling economy. Mortgages and loans significantly contribute to financial sector revenues, leading them to flourish in a low-interest-rate environment.
Q4 Financial momentum stocks
Momentum refers to the speed or rate of change in stock price. Healthy price trends tend to exhibit strong momentum, and price weakens when momentum subsides. The following stocks have been enjoying a rise in momentum in recent weeks. Can their streak continue in Q4?
Select Bancorp Inc (NASDAQ: SLCT)
Select Bancorp operates as the bank holding company for Select Bank & Trust Company providing banking services to individuals and small to medium-sized businesses. The company accepts deposit products and makes real-estate loan products available.
Select Bancorp has a price to earnings ratio (P/E) of 16, and it doesn’t offer a dividend. The SLCT share price is up 138% in a year. SLCT stock is held in 11 ETFs.
Analyst’s 12-Month average share price target is $17.25.
Mr Cooper Group Inc (NASDAQ: COOP)
Mr Cooper provides servicing, origination, and transaction-based services related to single-family residences in the United States. It recently announced the sale of its Xome Field Services unit to Cyprexx Services LLC.
The company has a P/E of 2.8, and it doesn’t offer a dividend. The COOP share price is up 88% in a year. COOP stock is held in 82 ETFs.
Analysts 12-Month average share price target is $44.29. That’s a potential upside of 9%.
Newmark Inc (NASDAQ: NMRK)
Newmark Group, Inc. provides commercial real estate services in the United States and internationally. Its services and products include capital markets structured finance, loan sales, agency leasing, property management, and commercial real estate due diligence consulting and advisory services.
The company has a P/E of 4.8, and it offers a 0.28% dividend yield. The NMRK share price is up 228% in a year. NMRK stock is held in 52 ETFs.
Analysts 12-Month average share price target is $17.17. That’s a potential upside of 21%.
Q4 Financial growth stocks
Growth in sales and/or earnings per share indicates a business that is growing. Growth stocks can make very lucrative investments when the share price rises in time with the business expansion. But growth stocks are also risky as investment analysis is based on future price action rather than historical price performance.
Famous growth investors include Philip Fisher, T. Rowe Price, and Jim Slater.
Piper Sandler Companies (NYSE: PIPR)
Piper Sandler Companies is an investment bank and institutional securities company. It offers client advice across various investment sectors, including healthcare, energy, consumer and retail, financial services, agriculture, renewables, technology, diversified industrials, and business services.
This stock has a P/E of 9, and it offers shareholders a 2% dividend yield. PIPR stock appears in 83 ETFs.
Piper Sandler has a 3-year Compound Annual Growth Rate (CAGR) for Sales of 14% and EPS of 20.9%.
Its sales growth for its latest interim period vs. the prior period is 72%. Analysts 12-Month average share price target is $160.50, 12% above the current share price.
Jefferies Financial Inc (NYSE: JEF)
Jefferies is a diversified financial service company engaged in investment banking and capital markets, asset management, and direct investing business.
This stock has a P/E of 7, and it offers shareholders a 2.8% dividend yield. JEF stock appears in 133 ETFs.
Jefferies has a 3-year Compound Annual Growth Rate (CAGR) for Sales of 12%, and EPS is 67%.
Its EPS growth for its latest interim period vs. the prior period is 140%. Analyst’s 12-Month average share price target is $42.33, 12% above the current share price.
Capital Bancorp Inc (NASDAQ: CBNK)
Capital Bancorp is a bank holding company. It serves businesses, not-for-profit associations, and entrepreneurs. The company operates through four segments: Commercial Banking, Capital Bank Home Loans, OpenSky, and Corporate Office.
CBNK stock appears in 15 ETFs, has a P/E of 10, and offers a 0.8% dividend yield.
Capital Bancorp’s three-year CAGR for Sales is 31%, and analysts’ 12-Month average share price target is $26.25, which offers a 9% potential upside.
Q4 Financial value stocks
Value investing is a prevalent type of stock market investing advocated by Billionaire investor Warren Buffett. When growth stocks are in favor, value stocks tend to be less popular and vice versa. Value stocks should be trading for less than their intrinsic or book value.
Enova International, Inc. (NYSE: ENVA)
Enova is a technology and analytics company providing online financial services.
The ENVA share price has risen 118% in a year and 258% in 5 years. The ENVA stock also appears in 72 ETFs, and it has a P/E of 2.6. ENVA’s Return on Equity, or ROE, is 61% TTM.
Analyst’s 12-Month average share price target is $43.25, which offers a 24% potential upside.
360 Digitech Inc (NYSE: QFIN)
360 Digitech operates a digital consumer finance platform under the 360 Jietiao brand in the People’s Republic of China. Its platform provides online consumer finance products to borrowers funded by institutional funding partners. The company also offers incremental credit assessment, collection, and other services and guarantees for defaulted loans.
Some investors are wary of investing in China just now due to regulatory crackdowns. But for those willing to take the risk, there are many value stock bargains to be found.
QFIN has a P/E of 4, and its Price/Book value is 1.7. The QFIN share price has risen 66% in the past year.
Analyst estimates indicate a strong buy with a 12-month average target price of $37.91 and a potential 92% upside.
Hennessy Advisors Inc (NASDAQ: HNNA)
Hennessy Advisors is a publicly owned investment manager. It launches and manages equity, fixed income, and balanced mutual funds.
HNNA has a P/E of 10 and a dividend yield of 5.6%. In Q3, Hennessy reported a 25% increase in EPS to $0.30.
Analyst estimates indicate a 12-month average target price of $13.25 and a potential 34% upside.
The stocks in this article were selected based on quantified analysis. This can give investors sector insight and a starting point from which to make investment decisions. This should not be construed as financial advice.