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2 Bank Stocks for Dividend-Seekers

We examine the capital adequacy and the solvency of the U.S. financial system.

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Editor’s note: Read the latest on how the coronavirus is rattling the markets and what investors can do to navigate it.

Eric Compton: Today, bank valuations are about as cheap as they have been since 2008. With lower valuations come higher dividend yields but also more implicit risk, which begs the question, “Are bank dividend yields worth it today?” The current situation is unprecedented in many ways. We’ve never really been in an environment where we have willingly shut down 30% of the economy, where GDP could drop as fast as the current estimates suggest, and where unemployment has spiked so high, so fast. 

Eric Compton does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.