This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

10 Financial Stocks With Double-Digit Gains in 2012

BOSTON ( TheStreet) -- Are big financial companies' stocks, many with double-digit gains this year, doing a dead-cat bounce or are they early on the path to steady recovery due to investors' renewed confidence in the beleaguered sector?

Maybe both, because financial services was the worst-performing industry last year, losing 18.4%, and banks and insurers had nowhere else to go but up.

But also because investors' fears about the European sovereign debt crisis and its potential impact on the already struggling global economy have waned, and they're finding banks, in particular the globe-spanning ones, super cheap.

The multi-faceted financial-services sector is up 8.6% this year, second only to the materials industry's 11% gain, while the S&P 500 has a rise of 4.7%.

Eric Oja, a bank-industry analyst at S&P Capital IQ, said in an interview that he thinks the financials run this year "is a short-term rebound" coming off a bottom in October when investors feared an economic disaster as the European crisis was showing no progress. As a result, the sector's shares got pounded and the "worst-case scenario" got priced in.

"Since then, there seems to be more clarity about what's going on in Europe," which has proved reassuring to investors, he said.

In addition to that, fourth-quarter financial-industry results, although not great, were also a bit of a confidence builder for investors as most banks showed decent results and improvement in key capital ratios that indicate stability.

Oja said he expects financial sector stocks may remain range bound over the near term given their big bounce recently.

Indeed, Monday was a tough day for banks stocks, as the KBW Bank Index (I:BKX) was down over 1%, with 21 out of 24 index components showing declines for the session. That pared this year's big gains.

Some of the largest share-price gainers this year were among the biggest losers last year.

The best example of that is Bank of America (BAC - Get Report). Its shares are up 31% this year after losing 58% in 2011.

Oja said that Bank of America was trading "at half of book value" late last year, "and that's a fire-sale price," so the company's fourth-quarter results may have many believing that the worst is behind it.

Perhaps also giving investors more confidence were last week's comments from the Federal Reserve, which indicated, in essence, that it will remain active in trying to help the economy by letting businesses and consumers know they can continue to borrow cheaply over the next few years.

The Fed said that it will probably keep interest rates low for the next three years and also provided an inflation target for the first time, and updated its economic projections.

Here, then, are 10 financial stocks that have among the biggest turnarounds in share prices this year:
1 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $15.75 0.00%
BCS $15.81 0.51%
C $51.65 0.64%
GS $181.07 -0.64%
JPM $62.13 0.00%


Chart of I:DJI
DOW 17,050.75 +138.46 0.82%
S&P 500 1,995.83 +15.91 0.80%
NASDAQ 4,810.7880 +19.6360 0.41%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs