A Look At Financial Stocks By Relative P/E, Price-to-Book and Yield

Last week we looked at the S&P 500 stocks in the Industrials sector. Below we highlight Financial stocks.

We calculated the relative P/E, price to book and dividend yield of each stock compared to their group and then added the three relative categories to come up with an overall number. The smaller the number the better (we're looking for low p/e, low price to book and high yield compared to the overall group average).

In the Diversified Financials group, ACAS, CIT, BAC, JPM, C, MER and MS currently rank best.

click to enlarge

As far as straight Banks go, Regions (RF), National City (NCC), Huntington (HBAN) and Washington Mutual (WM) look the best, while Hudson City (HCBK) and Commerce (CBH) look the worst.

Of the Insurance stocks, Allstate (ALL) looks best, and BXP looks the best in the REIT group.

Comments

[Huggi75:]

If you are using a straight yield, then this method does not make sense to me. Is the yield ratio (relative to peers) an inverse? Otherwise the higher the yield componenet, the lower a stock will rank.

2007 Oct 09 05:14 PM

[kainschild:]

you are correct, it is the inverse or reciprocal of the relative yield. I made the same comment on their home page. I'm sure they're busy but it would be nice if they would respond to our comments.

2007 Oct 11 12:16 PM