Trading at a still very cheap 9.9 times estimated 2021 earnings, this stock looks very reasonable in what remains a volatile stock market and in a sector that has lagged dramatically.
Citigroup stock investors receive a 3.09% dividend. Goldman Sachs has a price target of $67, and the posted consensus price objective is $65.72. The shares closed most recently at $66.02 apiece.
This industry leader trades at a still reasonable 14.5 times estimated 2021 earnings. JPMorgan Chase & Co. (NYSE: JPM) is one of the leading global financial services firms and one of the largest banking institutions in the United States, with about $2.6 trillion in assets. The company as it is today was formed through the merger of retail bank Chase Manhattan and investment bank J.P. Morgan.
The firm has many operating divisions, including investment and corporate banking, asset management, retail financial services, commercial banking, credit cards and financial transaction services.
The analyst voiced similar thoughts on JPMorgan as on Bank of America:
We expect the bank to generate best in class return on average tangible common shareholders’ equity by 2022 estimated, driven by scale and conservative underwriting, as well as notable excess capital return potential. In the short term, conservative underwriting should result in among the most earnings upside from releasing reserves across the large banks. JP Morgan has expanded into a number of new US markets, with scale across the US positioning them ideally to benefit from accelerating loan growth over the next two years. Moreover, unlike smaller peers, scale allows the bank to substantially increase investment over the next few years without notably jeopardizing returns, driving further market share gains.
Investors receive a 2.64% dividend. The $139 Goldman Sachs price objective is well above the $122.21 consensus price target. JPMorgan stock closed Thursday at $135.87, after more than a 3% gain on the day.
This is one of Wall Street’s white-glove firms, and it may be among the best buys in the banking and investment arena. Morgan Stanley (NYSE: MS) is a global investment bank with leading positions in investment banking (M&A and equity underwriting), equity trading and wealth management, which contributes nearly 50% of firmwide revenues. The firm also has an asset management business, which adds to the lower-risk business profile the firm has pursued since the financial crisis.
Last year, this Wall Street investment bank agreed on a $13 billion purchase of discount brokerage E-Trade. With 5.2 million customers, it was once a revolutionary platform that “helped usher in a dramatic shift among financial services firms” and fueled the rise of indexes and exchange-traded funds, making investing vastly easier for do-it-yourself investors.
Investors receive a 1.90% dividend. The Goldman Sachs price target is $75. The consensus price objective is $72.10, and Morgan Stanley stock ended Thursday’s trading at $74.94 per share.
Given that all four of these stocks are trading near the Goldman Sachs price targets, with the positive outlook for the companies for the back half of this year, the price targets could very possibly head substantially higher. Investors looking to add financials to portfolios can feel very comfortable adding these market giants as they pay solid dividends and have a very bright outlook for 2021 and beyond.