Financial Services: Despite Recession Fears, We Find Value in Banks
The sector overall is slightly undervalued.
The Morningstar U.S. Financial Services Index outperformed the Morningstar U.S. Markets Index quarter to date through June 25, up 6% compared with 3% (Exhibit 1). Overall, the median U.S.-based financial-services stock trades at about a 6% discount to its fair value estimate, so we assess the sector as modestly undervalued.
Financials have recently clawed their way back up - source: Morningstar Analysts
Michael Wong does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.