5 Financial Services Stocks Gurus Are Banking On

Fed announces biggest interest rate hike in nearly 3 decades

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Jun 15, 2022
Summary
  • Dow rebounds as Federal Reserve announces biggest interest rate hike in nearly 30 years.
  • GuruFocus’ Aggregated Portfolio listed several bank stocks with high guru buys and ownership.
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In light of the Federal Reserve announcing the biggest interest rate hike in nearly three decades, five bank stocks with high guru buys as of the first-quarter 13F portfolio filing date are Citigroup Inc. (

C, Financial), JPMorgan Chase & Co. (JPM, Financial), Webster Financial Corp. (WBS, Financial), Bank of America Corp. (BAC, Financial) and Wells Fargo & Co. (WFC, Financial) according to the Aggregated Portfolio of Gurus, a Premium feature of GuruFocus.

U.S. market blasts off as Federal Reserve announces biggest interest rate hike in three decades

On Wednesday, the Dow Jones Industrial Average closed at 30,668.53, up 303.70 points from Tuesday’s close of 30,364.83.

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Stocks surged on the back of the central bank raising interest rates to a range between 1.5% and 1.75%, up 0.75% from the previous range and the highest rate hike since 1994. Fed Chairman Jerome Powell added in a press conference that while the interest rate hikes will be done meeting by meeting, the central bank may increase the rate a further 0.5% to 0.75% in July.

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As investors monitor the Fed’s interest rate movements, GuruFocus’ Aggregated Portfolio allows users to view the most-broadly-held guru stocks for a specific sector or market cap. For example, users can view bank stocks with high guru buys as of the first quarter, based on 13F equity portfolio filings.

Investors should be aware that 13F filings do not give a complete picture of a firm’s holdings as the reports only include its positions in U.S. stocks and American depository receipts, but they can still provide valuable information. Further, the reports only reflect trades and holdings as of the most-recent portfolio filing date, which may or may not be held by the reporting firm today or even when this article was published.

Citigroup

Twenty-seven gurus own shares of Citigroup (

C, Financial) with a combined weight of 44.16%. Sixteen gurus purchased shares during the first quarter.

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Shares of Citigroup traded around $47.15, showing the stock is significantly undervalued based on Wednesday’s price-to-GF Value ratio of 0.69.

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The New York-based bank has a GF Score of 71 out of 100 based on a GF Value rank of 8 out of 10, a momentum rank of 7 out of 10, a profitability rank of 5 out of 10, a growth rank of 4 out of 10 and a financial strength rank of 3 out of 10.

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Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway Inc. (BRK.A, Financial)(BRK.B, Financial) invested in 55,155,797 shares of Citigroup, giving the position 0.81% weight in its equity portfolio.

JPMorgan Chase

Thirty gurus own shares of JPMorgan Chase (

JPM, Financial) with a combined weight of 31.13%. Fourteen gurus purchased shares during the first quarter.

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Shares of JPMorgan Chase traded around $115.17, showing the stock is modestly undervalued based on Wednesday’s price-to-GF Value ratio of 0.79.

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The New York-based bank has a GF Score of 77 out of 100: Although the bank has a GF Value rank of 9 out of 10 and a rank of 6 out of 10 for profitability and growth, JPMorgan Chase’s financial strength ranks just 4 out of 10 while its momentum ranks 5 out of 10.

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Gurus with holdings in JPMorgan Chase include

PRIMECAP Management (Trades, Portfolio) and Ken Fisher (Trades, Portfolio)’s Fisher Investments.

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Webster Financial

Fourteen gurus own shares of Webster Financial (

WBS, Financial) with a combined weight of 4.64%. Eleven gurus invested in shares during the first quarter.

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Shares of Webster Financial traded around $45.73, showing the stock is modestly undervalued based on Wednesday’s price-to-GF Value ratio of 0.87.

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The Stamford, Connecticut-based bank has a GF Score of 83 out of 100, driven by a rank of 8 out of 10 for growth and momentum and a rank of 7 out of 10 for profitability and GF Value despite financial strength ranking just 3 out of 10.

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Bank of America

Thirty gurus own shares of Bank of America (

BAC, Financial) with a combined weight of 107.87%. Ten gurus bought shares during the first quarter.

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Shares of Bank of America traded around $32.05, showing the stock is modestly undervalued based on Wednesday’s price-to-GF Value ratio of 0.85.

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The Charlotte, North Carolina-based bank has a GF Score of 71 out of 100, driven by a momentum rank of 8 out of 10 and a GF Value rank of 7 out of 10 despite profitability, growth and financial strength ranking between 3 and 5 out of 10.

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Wells Fargo

Thirty-six gurus own shares of Wells Fargo (

WFC, Financial) with a combined weight of 97.22%. Eight gurus purchased shares during the first quarter despite 22 gurus selling shares.

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Shares of Wells Fargo traded around $38.17, showing the stock is modestly undervalued based on Wednesday’s price-to-GF Value ratio of 0.80.

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The San Francisco-based bank has a GF Score of 80 out of 100, driven by a momentum rank of 10 out of 10, a GF Value rank of 9 out of 10, a growth rank of 7 out of 10, a profitability rank of 6 out of 10 and a financial strength rank of 3 out of 10.

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I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours. Click for the complete disclosure
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