In this article, we discuss the 5 best diversified bank stocks to invest in. If you want to read our detailed analysis of these stocks, go directly to 11 Best Diversified Bank Stocks to Invest In.
5. Fidelity National Information Services, Inc. (NYSE:FIS)
Number of Hedge Fund Holders: 66
Fidelity National Information Services, Inc. (NYSE:FIS) provides technology solutions for merchants, banks, and capital markets firms worldwide. On February 28, investment advisory Mizuho maintained a Buy rating on Fidelity National Information Services, Inc. (NYSE:FIS) stock and raised the price target to $76 from $73.
At the end of the fourth quarter of 2023, 66 hedge funds in the database of Insider Monkey held stakes worth $3.2 billion in Fidelity National Information Services, Inc. (NYSE:FIS), compared to 65 in the preceding quarter worth $1.8 billion.
In its Q4 2023 investor letter, Broyhill Asset Management, an asset management firm, highlighted a few stocks and Fidelity National Information Services, Inc. (NYSE:FIS) was one of them. Here is what the fund said:
“Recent investments in this bucket include Ball Corp, Fidelity National Information Services, Inc. (NYSE:FIS), and Avantor. Fidelity National Information Services is a payment provider for financial institutions and merchants around the world. We took a hard look at the business around the time we established our investment in Fiserv, discussed in detail here. Thankfully, we decided to pass at the time in favor of what we believed to be a much better competitively positioned business with a much stronger track record of execution. Since then, issues at FIS have gone from bad to worse. The $48 billion acquisition of Worldpay in 2019, which took leverage up to 5.5x on the balance sheet, hasn’t turned out quite as well as Fiserv’s acquisition of First Data. Fast forward to today, and FIS is unwinding prior mistakes, selling off a 55% interest in the recently acquired business (meaning we now have a hard number for the remaining 45% they own), and using proceeds to take leverage back down to 2.5x post close while repurchasing at least $3.5B of stock through next year. As a result, shareholders will be left with a cleaner balance sheet and a simpler organizational structure, consisting primarily of their very defensive, very profitable core banking business, which traded down to a single-digit multiple vs historical averages for the industry closer to 20x.”
4. Wells Fargo & Company (NYSE:WFC)
Number of Hedge Fund Holders: 72
Wells Fargo & Company (NYSE:WFC) is a diversified financial services company that provides banking, investment, mortgage, and consumer and commercial finance products and services. On March 13, investment advisory Compass Point maintained a Buy rating on Wells Fargo & Company (NYSE:WFC) stock and raised the price target to $64 from $62.
At the end of the fourth quarter of 2023, 72 hedge funds in the database of Insider Monkey held stakes worth $5.5 billion in Wells Fargo & Company (NYSE:WFC), compared to 77 in the previous quarter worth $4.3 billion.
3. Citigroup Inc. (NYSE:C)
Number of Hedge Fund Holders: 87
Citigroup Inc. (NYSE:C) is a financial services holding company that provides various financial products and services to consumers, corporations, governments, and institutions. On March 14, investment advisory Goldman Sachs upgraded Citigroup Inc. (NYSE:C) stock to Buy from Neutral with a price target of $68.
At the end of the fourth quarter of 2023, 87 hedge funds in the database of Insider Monkey held stakes worth $10.2 billion in Citigroup Inc. (NYSE:C), compared to 79 in the previous quarter worth $6.9 billion.
2. Bank of America Corporation (NYSE:BAC)
Number of Hedge Fund Holders: 96
Bank of America Corporation (NYSE:BAC) provides banking and financial products and services for individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments. On January 30, investment advisory Oppenheimer maintained an Outperform rating on Bank of America Corporation (NYSE:BAC) stock and raised the price target to $50 from $49.
Among the hedge funds being tracked by Insider Monkey, Omaha, Nebraska-based investment firm Berkshire Hathaway is a leading shareholder in Bank of America Corporation (NYSE:BAC) with 1 billion shares worth more than $34 billion.
In its Q4 2023 investor letter, Diamond Hill Capital, an asset management firm, highlighted a few stocks and Bank of America Corporation (NYSE:BAC) was one of them. Here is what the fund said:
“Among our top individual contributors in Q4 were KKR and Bank of America Corporation (NYSE:BAC). Banking and financial services company Bank of America rallied alongside large-cap banks broadly in Q4 as the market focused less on interest-rate risks amid the Fed’s announcement it was likely done raising interest rates. Banks also likely generally benefited from a relief rally following three-plus quarters of negative sentiment to start the year. Industry trends aside, however, we maintain our conviction in Bank of America’s position given its diversified, low-cost deposit base, which we believe remains less susceptible to flight.”
1. JPMorgan Chase & Co. (NYSE:JPM)
Number of Hedge Fund Holders: 103
JPMorgan Chase & Co. (NYSE:JPM) operates as a financial services company worldwide. On March 13, investment advisory RBC Capital maintained an Outperform rating on JPMorgan Chase & Co. (NYSE:JPM) stock with a price target of $185.
At the end of the fourth quarter of 2023, 103 hedge funds in the database of Insider Monkey held stakes worth $9 billion in JPMorgan Chase & Co. (NYSE:JPM), compared to 109 in the preceding quarter worth $6 billion.
In its Q4 2023 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and JPMorgan Chase & Co. (NYSE:JPM) was one of them. Here is what the fund said:
“PNC Financial and JPMorgan Chase & Co. (NYSE:JPM) performed well due to more benign inflation data, which the market likely interpreted as a sign that a recession is now less likely to occur. Recall that historically speaking, banks are hyper-cyclical stocks and typically will trade lower if investors foresee a recession, because recessions tend to trigger loan losses.”
You can also take a peek at 13 Most Promising Low-Cost Stocks According to Analysts and 11 Best Shipping Stocks That Pay Dividends.
