Buy These 5 Big Dividend Paying Banks Now – 24/7 Wall St.
Bank and finance
Many on Wall Street seemed petrified by the prospect of a rate hike. While quantitative easing is expected to start in November, most Wall Street people don’t think the Federal Reserve will start raising interest rates until 2023. Even if it did increase them four times by 25 basis points, that would only put the federal funds rate at 1.25%. Remember that the rate before the collapse of the real estate and stock market in 2008 was 4.75%.
One industry that is okay with the rate hike is banking, which is expected to see a sharp increase in the net interest margin, or the ratio that measures a company’s success in investing its funds versus spending it on. the same investments. In other words, offer bank customers a two-year 1% certificate of deposit and use the deposit to buy a two-year Treasury that pays 1.26%. The bank pays the CD holder the 1% and collects the remainder of the Treasury coupon. Although these rates are far from the current figures, the example shows how banks make money.
Jefferies is banking positive and has five dividend paying stocks rated Buy. It is important to remember that no analyst report should be used as the sole basis for any buy or sell decision.
Fifth Third Bancorp
This top-tier super-regional banking stock remains incredibly cheap. Fifth Third Bancorp (NASDAQ: FITB) is a diversified financial services company headquartered in Cincinnati, Ohio, and the indirect parent company of Fifth Third Bank, National Association, a federally chartered institution.
As of March 31, 2021, the company had $ 207 billion in assets and operated 1,098 full-service banking centers and 2,383 Fifth Third-branded ATMs in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee, West Virginia, Georgia and North Carolina. and South Carolina. In total, Fifth Third provides its customers with access to approximately 53,000 free ATMs across the United States.
Fifth Third is among the largest fund managers in the Midwest and, as of March 31, 2021, had $ 464 billion in assets under watch, including $ 58 billion for individuals, corporations and nonprofits by the through its Trust and Registered Investment Advisory Firms.
The company posted very strong second quarter results, and many believe management’s guidance for the current quarter is very conservative.
Shareholders receive a dividend of 2.75%. The Jefferies price target for Fifth Third Bancorp stock is $ 46. The Wall Street consensus target is $ 43.58, in line with Tuesday’s closing price of $ 43.57 per share.
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