In the current market environment where tech stocks are trading at high premiums, five financial sector stocks are standing out for their attractive valuations. These stocks, all with large market capitalizations, are currently trading below their book value while continuing to pay dividends. Investors who are looking for opportunities that are contrary to the current trend might find these stocks appealing.
First up is Citigroup, with a market capitalization of $117.46 billion. The stock is trading at 62% of book value and has a price-earnings ratio of 18. Despite a 9.56% decline in earnings over the past 5 years, this year’s earnings have seen a significant increase of 46%. Citigroup also pays a dividend of 2.59%, making it an attractive option for income-seeking investors.
Next is Citizens Financial Group, with a market cap of $15.64 billion. The stock is currently trading at a 28% discount from book value, with a price-earnings ratio of 12.35. While earnings have declined by 2.34% over the past 5 years, this year’s earnings are up by 0.76%. Investors in Citizens Financial Group also benefit from a dividend yield of 4.93%, adding to the appeal of this stock.
Capital One Financial, with a market capitalization of $54.80 billion, is another stock worth considering. The stock is trading at 95% of book value, with a price-earnings ratio of 11.23. Earnings for this year have seen a significant increase of 9.50%, while earnings over the past 5 years have also shown a slight uptick of 0.22%. Capital One Financial pays a dividend of 1.67%, adding to the overall attractiveness of this stock.
M & T Bank, a regional bank with a market capitalization of $24.06 billion, is trading at a 4% discount from book value. The price-earnings ratio is 9.76, making this stock another attractive option for value investors. While earnings for this year are down by 10.65%, they have seen an increase of 4.38% over the past 5 years. M & T Bank also pays a dividend of 3.60%, providing investors with an additional source of income.
Lastly, State Street Corp has a market capitalization of $21.89 billion. The stock is currently available for purchase at book value, with a price-earnings ratio of 13.54. Earnings for this year have increased by 3.10%, while earnings over the past 5 years have declined by 2.67%. State Street Corp pays a dividend of 3.72%, making this stock an attractive option for income-seeking investors.
Overall, these five financial sector stocks offer investors an opportunity to invest in companies with solid fundamentals, attractive valuations, and the added benefit of dividends. In a market environment where tech stocks are trading at high multiples, these contrarian picks could provide a stable source of returns for investors looking to diversify their portfolios.
