We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Analyst Blog Highlights Wintrust Financial, Northeast Community Bancorp, Orange County Bancorp, Reinsurance Group of America and Primerica
Read MoreHide Full Article
For Immediate Release
Chicago, IL – September 22, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Wintrust Financial (WTFC - Free Report) , Northeast Community Bancorp (NECB - Free Report) , Orange County Bancorp, Inc. (OBT - Free Report) , Reinsurance Group of America (RGA - Free Report) and Primerica (PRI - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
Fed Anticipates Higher Rates for Longer: 5 Big Winners
The Federal Reserve may have left the benchmark federal funds rate unchanged this month but has signaled another rate hike and that rates may remain elevated for a longer period than earlier expected.
This calls for investing in stocks such as Wintrust Financial, Northeast Community Bancorp, Orange County Bancorp, Inc., Reinsurance Group of America and Primerica. These should witness a ramp-up in profits amid interest rate hikes.
Fed's Hawkish Stance
The Fed, in its recent policy meeting, has kept interest rates unchanged, as widely expected. Now, the benchmark rate stands at a range of 5.25%-5.5%, which is still the highest in 22 years.
However, the central bank expects another quarter percentage point interest rate hike by the end of this year, implying that the benchmark rate will finish the year in a range of 5.5-5.75%. Twelve out of 19 Fed officials penciled in one more interest rate increase this year.
The Fed's dot plot projections also showed that there will be fewer rate cuts next year. Interest rates are projected to stay higher for longer, with two rate cuts expected in 2024, two less than what was projected during the June policy meeting. Thus, the benchmark rate is expected to remain above the 5% mark next year as well.
And why not? Encouraging economic growth coupled with a resilient labor market is expected to keep inflation elevated, and the Fed hawkish when it comes to its monetary policies. Fed officials, in reality, expect the gross domestic product (GDP) to perk up 2.1% this year, which is more than double the June projection. Similarly, the GDP outlook for next year increased to 1.5% from 1.1%.
On the other hand, inflation continues to hover well above the Fed's desired target of 2%. The core personal consumption expenditures index, the Fed's favored inflation gauge, which strips out the volatile food and energy costs came in at 4.2% in July.
Financials to Win Big
With interest rates expected to stay higher for longer, the broader stock market primarily led by tech players took a hammering on Sep 20. After all, interest rate hikes curtail consumer outlays, increase the cost of borrowings, and hamper economic growth. But investors shouldn't shun equities. Instead, they should place their bets on financial stocks, including banks and insurance companies.
An increase in interest rates leads to an increase in the spread between a bank's short-term liability, like deposits, and its long-term assets such as loans, thereby boosting the lender's profit margins.
Insurers, by the way, earn by investing premiums they receive from policyholders in government and corporate bonds. Now, rate hikes increase the yields on these bonds. Insurers, thus, can invest their premiums at a higher yield, and earn more.
Top 5 Choices
Given the positives, we have selected five solid financial stocks that should make meaningful additions to your portfolio. The stocks boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Wintrust Financial provides banking services, trust and investment services, and commercial insurance premium financing. WTFC currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased 0.3% over the past 60 days. The company's expected earnings growth for the current year is 24.3%.
Northeast Community Bancorp is a federally chartered stock holding company established to be the holding company for Northeast Community Bank. NECB currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has increased 10% over the past 60 days. The company's expected earnings growth for the current year is 81%.
Orange County Bancorp, Inc. provides commercial and consumer banking services to individuals, small businesses, and local municipal governments. OBT currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased 20.3% over the past 60 days. The company's expected earnings growth for the current year is 21.7%.
Reinsurance Group of America is a leading global provider of traditional life and health reinsurance and financial solutions. RGA currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased 2.6% over the past 60 days. The company's expected earnings growth for the current year is 25.6%.
Primerica assists its clients in meeting their needs for term life insurance. PRI currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased nearly 2% over the past 60 days. The company's expected earnings growth for the current year is 36.6%.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Zacks Analyst Blog Highlights Wintrust Financial, Northeast Community Bancorp, Orange County Bancorp, Reinsurance Group of America and Primerica
For Immediate Release
Chicago, IL – September 22, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Wintrust Financial (WTFC - Free Report) , Northeast Community Bancorp (NECB - Free Report) , Orange County Bancorp, Inc. (OBT - Free Report) , Reinsurance Group of America (RGA - Free Report) and Primerica (PRI - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
Fed Anticipates Higher Rates for Longer: 5 Big Winners
The Federal Reserve may have left the benchmark federal funds rate unchanged this month but has signaled another rate hike and that rates may remain elevated for a longer period than earlier expected.
This calls for investing in stocks such as Wintrust Financial, Northeast Community Bancorp, Orange County Bancorp, Inc., Reinsurance Group of America and Primerica. These should witness a ramp-up in profits amid interest rate hikes.
Fed's Hawkish Stance
The Fed, in its recent policy meeting, has kept interest rates unchanged, as widely expected. Now, the benchmark rate stands at a range of 5.25%-5.5%, which is still the highest in 22 years.
However, the central bank expects another quarter percentage point interest rate hike by the end of this year, implying that the benchmark rate will finish the year in a range of 5.5-5.75%. Twelve out of 19 Fed officials penciled in one more interest rate increase this year.
The Fed's dot plot projections also showed that there will be fewer rate cuts next year. Interest rates are projected to stay higher for longer, with two rate cuts expected in 2024, two less than what was projected during the June policy meeting. Thus, the benchmark rate is expected to remain above the 5% mark next year as well.
And why not? Encouraging economic growth coupled with a resilient labor market is expected to keep inflation elevated, and the Fed hawkish when it comes to its monetary policies. Fed officials, in reality, expect the gross domestic product (GDP) to perk up 2.1% this year, which is more than double the June projection. Similarly, the GDP outlook for next year increased to 1.5% from 1.1%.
On the other hand, inflation continues to hover well above the Fed's desired target of 2%. The core personal consumption expenditures index, the Fed's favored inflation gauge, which strips out the volatile food and energy costs came in at 4.2% in July.
Financials to Win Big
With interest rates expected to stay higher for longer, the broader stock market primarily led by tech players took a hammering on Sep 20. After all, interest rate hikes curtail consumer outlays, increase the cost of borrowings, and hamper economic growth. But investors shouldn't shun equities. Instead, they should place their bets on financial stocks, including banks and insurance companies.
An increase in interest rates leads to an increase in the spread between a bank's short-term liability, like deposits, and its long-term assets such as loans, thereby boosting the lender's profit margins.
Insurers, by the way, earn by investing premiums they receive from policyholders in government and corporate bonds. Now, rate hikes increase the yields on these bonds. Insurers, thus, can invest their premiums at a higher yield, and earn more.
Top 5 Choices
Given the positives, we have selected five solid financial stocks that should make meaningful additions to your portfolio. The stocks boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Wintrust Financial provides banking services, trust and investment services, and commercial insurance premium financing. WTFC currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased 0.3% over the past 60 days. The company's expected earnings growth for the current year is 24.3%.
Northeast Community Bancorp is a federally chartered stock holding company established to be the holding company for Northeast Community Bank. NECB currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has increased 10% over the past 60 days. The company's expected earnings growth for the current year is 81%.
Orange County Bancorp, Inc. provides commercial and consumer banking services to individuals, small businesses, and local municipal governments. OBT currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased 20.3% over the past 60 days. The company's expected earnings growth for the current year is 21.7%.
Reinsurance Group of America is a leading global provider of traditional life and health reinsurance and financial solutions. RGA currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased 2.6% over the past 60 days. The company's expected earnings growth for the current year is 25.6%.
Primerica assists its clients in meeting their needs for term life insurance. PRI currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has increased nearly 2% over the past 60 days. The company's expected earnings growth for the current year is 36.6%.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.