This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
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
TheStreet Open House

4 Stock Strategies From Wall Street: Feb. 10 (Update 1)

Stocks in this article: LPS SNV CMVT TLAB FNBN RLOG HIFS NETL ALL

3) Dare To Pick European Banks?

If you have the stomach for European bank stocks, consider Deutsche Bank's analysis of the long term financing move by the European Central Bank.

Like most economists, Deutsche bank analysts note that the liquidity risk for European banks has greatly decreased as they can now borrow money at 1% for three years. The firm estimates that the ECB's move addresses liquidity risk for the next year or two.

However, the firm warns that investors should be careful in trying to reap the benefits of the long term refinancing operation (LTRO). "Though incrementally helpful to earnings per share... we believe that the sector benefits of LTRO are priced, and that stock picking is now most important," it writes.

That means the actual LTRO allotment on Feb 29 is "no longer a significant catalyst." Analysts disagree on the net take up for the Feb. 29 LTRO. However, Deutsche Bank says the specific number is "irrelevant."

"The 'LTRO-is-good' thought process has played out in the stocks and we don't see this as a further catalyst," it adds.

As for actual stocks, the firms feel best about Julies Baer, Swedbank and Barclays (BCS). These are top tier banks and retail names with better capital, it says. "Key downside risks relate to a deterioration in sovereign and bank funding markets, a downturn in capital market revenues, and impact on credit quality from weaker economic conditions."

Like many bank stocks, Barclays has surged this year. The stock is up 33% year to date after losing a third of its market cap last year. Shares were last trading near $14.59.

3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link 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

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, 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
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,387.21 -291.49 -1.65%
S&P 500 2,029.55 -27.54 -1.34%
NASDAQ 4,681.4970 -90.2660 -1.89%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs