Wall Street Analysts Stay Long on US Banks
Wall Street analysts expect subdued growth across sectors in 2018, amid concerns of high valuation. With the recent global stock market rout, stocks erased their January 2018 gains. Analysts are positive on the overall performance of banks (XLF) due to the interest rate outlook being hawkish. An interest rate hike could widen banks’ net interest margins.
Citigroup (C) has received strong ratings in February 2018. Of the 29 analysts covering the stock, 17 have recommended “strong buy” or “buy,” compared with 16 in December 2016. Of the remaining 12 analysts, ten have recommended “hold” and two have recommended “underperform” or “sell.” The stock has a one-year forward price target of $84.27 with an upside of 12.4% based on its current price.
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Among Citigroup’s peers, Bank of America (BAC) is leading in February 2018, with 22 of 30 analysts recommending “buy” or “strong buy,” seven recommending “hold,” and one recommending “sell.” It has a price target of $34.03, while its current price is $31.23.
Of the 28 analysts covering JPMorgan Chase (JPM), 13 have recommended “buy” or “strong buy,” compared with 15 in November 2017. Two have recommended “underperform” or “sell,” and 12 have recommended “hold.”
Wells Fargo (WFC) has the weakest ratings among major bankers. Four analysts recommended “underperform,” 15 recommended “hold,” and 12 recommended ”buy” in December. Its price target is lower than its current price.