Financial stocks have seesawed this year between the continued wait for the Federal Reserve to raise interest rates, exposure to China as well as other emerging markets and prolonged low oil prices. The financial sector got hit particularly hard by the extreme market volatility in August. But the sector still has plenty of worthy investment opportunities.

For the year, the S&P 500 Financials Index is down 1.6% compared to the S&P 500 which is up 1.6%.

So what are some of the best investment ideas for financial stocks right now?

Credit Suisse analysts updated a "Top Picks" investment ideas note to clients on Wednesday. The research note puts forth the analysts' best investment ideas in a variety of sub-sectors for the next six-to-12 months. Analysts were allowed to choose up to three stocks in their coverage area and ranking them. The updated exercise resulted in a list of 119 top stock ideas.

The below list of 10 best financial stock ideas are the first ranked picks by Credit Suisse banking and financial services analysts. TheStreet paired them with ratings from TheStreet Ratings for added perspective.

TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

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AMG

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1. Affiliated Managers Group (AMG) - Get Affiliated Managers Group, Inc. Report
Industry: Financial Services/Asset Managers
Year-to-date return: -12.1%

Credit Suisse's Target Price: $236

Credit Suisse Target Said: (1) Capital Deployment via Deals and Buybacks: We continue to look for 3-5 deals over the next 12 months. AMG announced a new Wealth affiliate in 2Q (bringing Wealth AuM to ~35B), and its deal pipeline remains robust, skewed towards Alt Managers (currently ~35% of earnings). Additionally, we expect buybacks to provide support in the event of slower deal execution. Sellside estimates currently embed zero deals, limited buybacks. (2) Diverse Manager Base coupled with resilient institutional flows have offset weakness in the retail channel (US driven). We anticipate 4-5% OG for AMG compared to 0-2% for peers.

TheStreet Said: TheStreet Ratings team rates AFFILIATED MANAGERS GRP INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

We rate AFFILIATED MANAGERS GRP INC (AMG) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • AMG's revenue growth has slightly outpaced the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 1.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Capital Markets industry and the overall market, AFFILIATED MANAGERS GRP INC's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • AFFILIATED MANAGERS GRP INC has improved earnings per share by 32.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, AFFILIATED MANAGERS GRP INC increased its bottom line by earning $7.99 versus $6.49 in the prior year. This year, the market expects an improvement in earnings ($12.75 versus $7.99).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 30.0% when compared to the same quarter one year prior, rising from $99.00 million to $128.70 million.
  • Net operating cash flow has slightly increased to $351.40 million or 7.06% when compared to the same quarter last year. Despite an increase in cash flow of 7.06%, AFFILIATED MANAGERS GRP INC is still growing at a significantly lower rate than the industry average of 79.46%.
  • You can view the full analysis from the report here: AMG
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JPM

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2. JPMorgan Chase & Co. (JPM) - Get JPMorgan Chase & Co. (JPM) Report
Industry: Financial Services/Large Cap Banks
Year-to-date return: 5.2%

Credit Suisse's Target Price: $75

Credit Suisse Target Said: Catalysts: (1) continued fundamental outperformance and (2) clarification of /proven manageability /possible reduction in mandated domestic GSIB capital surcharges. JPM has shown both ability and willingness to optimize its balance sheet and capital deployment. It's also proven the value of a scaled, integrated financial services entity. Expect continued fundamental outperformance to drive the shares.

TheStreet Said: TheStreet Ratings team rates JPMORGAN CHASE & CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate JPMORGAN CHASE & CO (JPM) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, expanding profit margins and attractive valuation levels. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • JPMORGAN CHASE & CO has improved earnings per share by 23.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, JPMORGAN CHASE & CO increased its bottom line by earning $5.29 versus $4.32 in the prior year. This year, the market expects an improvement in earnings ($5.98 versus $5.29).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Commercial Banks industry average. The net income increased by 22.1% when compared to the same quarter one year prior, going from $5,572.00 million to $6,804.00 million.
  • The gross profit margin for JPMORGAN CHASE & CO is currently very high, coming in at 89.85%. Regardless of JPM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, JPM's net profit margin of 27.66% compares favorably to the industry average.
  • You can view the full analysis from the report here: JPM
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KEY

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3. KeyCorp (KEY) - Get KeyCorp (KEY) Report
Industry: Financial Services/Mid-Cap Banks
Year-to-date return: -5%

Credit Suisse's Target Price: $15.50

Credit Suisse Target Said: The story for 2015 will center on the company's ability to generate positive operating leverage with further efficiencies. Without heroic forecasts for the near term outlook including a combination of 4% revenue growth, 3% expenses growth, and a 4% decline in the average share count, we forecast 3% growth in operating EPS with confidence in the achievability of the forecast. The capital return story remains strong, and we forecast a return of 92% of capital to shareholders in the form of dividends and buybacks for full-year 2015.

TheStreet Said: TheStreet Ratings team rates KEYCORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate KEYCORP (KEY) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, increase in stock price during the past year and expanding profit margins. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 3.3%. Since the same quarter one year prior, revenues slightly increased by 7.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • KEYCORP has improved earnings per share by 13.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, KEYCORP increased its bottom line by earning $1.04 versus $0.93 in the prior year. This year, the market expects an improvement in earnings ($1.08 versus $1.04).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Commercial Banks industry average. The net income increased by 17.7% when compared to the same quarter one year prior, going from $186.00 million to $219.00 million.
  • After a year of stock price fluctuations, the net result is that KEY's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The gross profit margin for KEYCORP is currently very high, coming in at 89.83%. Regardless of KEY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 19.36% trails the industry average.
  • You can view the full analysis from the report here: KEY
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SCHW

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4. The Charles Schwab Corp. (SCHW) - Get Charles Schwab Corporation Report
Industry: Financial Services/Brokers, Exchanges & Alternative Asset Managers
Year-to-date return: 4.1%

Credit Suisse's Target Price: $32

Credit Suisse Target Said: Charles Schwab is a leading provider of advice-driven and self-directed financial services to the individual investor and independent investment advisors. We like the Schwab asset gathering story and see the shares as one of the better places to invest given significant macro & company specific catalyst. Macro catalyst: We expect earnings power to more than double form current levels as short term rates rise. Company specific catalyst: Schwab can more optimally monetize ~$75 Billion of client cash balances by growing its affiliated bank, this should drive ~20-30% earnings accretion over the next 2-3 years even if interest rates remain at current levels.

TheStreet Said: TheStreet Ratings team rates SCHWAB (CHARLES) CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate SCHWAB (CHARLES) CORP (SCHW) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, growth in earnings per share, increase in net income and solid stock price performance. We feel its strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 6.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • SCHWAB (CHARLES) CORP has improved earnings per share by 16.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, SCHWAB (CHARLES) CORP increased its bottom line by earning $0.96 versus $0.78 in the prior year. This year, the market expects an improvement in earnings ($0.99 versus $0.96).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 17.1% when compared to the same quarter one year prior, going from $321.00 million to $376.00 million.
  • 40.90% is the gross profit margin for SCHWAB (CHARLES) CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.12% is above that of the industry average.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
  • You can view the full analysis from the report here: SCHW
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MET

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5. MetLife Inc. (MET) - Get MetLife, Inc. (MET) Report
Industry: Financial Services/Insurance, Fidelity & Guaranty & Life
Year-to-date return: -6.7%

Credit Suisse's Target Price: $60

Credit Suisse Target Said: Our target price of $60, implies that MET trade at 9.5x of 2016 operating earnings. We think current price of $56 undervalues the stock at less than 9x our 2016 estimate, given improved visibility on capital returns and continuation of organic growth in international markets. Recently, MET challenged FSOC's Non-Bank SIFI designation in a court action. While initial reaction on shares has been negative, we see the optionality for shareholders as neutral to positive because 1) Given MET's current level of capital returns, adverse consequence of a stress test is not very high, 2) While it is not easy for MET to win, the positive impact from a favorable ruling on MET and on the capital framework would be substantial, and 3) The bold move from MET could imply further significant action from management that would be positive for shareholders. In addition, given MET's focus on free cash flow going forward and the goal to reach 45-55% FCF by 2018, we see the potential for further upside to the stock.

TheStreet Recommends

TheStreet Said: TheStreet Ratings team rates METLIFE INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

We rate METLIFE INC (MET) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, notable return on equity and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Insurance industry and the overall market on the basis of return on equity, METLIFE INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 13.1%. Since the same quarter one year prior, revenues fell by 11.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Despite currently having a low debt-to-equity ratio of 0.35, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
  • METLIFE INC's earnings per share declined by 21.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, METLIFE INC increased its bottom line by earning $5.42 versus $2.91 in the prior year. For the next year, the market is expecting a contraction of 3.5% in earnings ($5.23 versus $5.42).
  • You can view the full analysis from the report here: MET
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ALL

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6. Allstate Corp. (ALL) - Get Allstate Corporation Report
Industry: Financial Services/Insurance, P&C
Year-to-date return: -10.5%

Credit Suisse's Target Price: $74

Credit Suisse Target Said: Though auto collision frequency have weighed on margins, ALL is taking action by increasing prices across its book and cutting expenses. We believe auto margin improvement should start to appear in 4Q. Release of capital supporting the home business from cheaper reinsurance ($1-2b). Potential sale of runoff life business (could fund $1.5b of share buyback). Appreciation for positive value of Esurance, both as long term business and as runoff.

TheStreet Said: TheStreet Ratings team rates ALLSTATE CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate ALLSTATE CORP (ALL) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and good cash flow from operations. We feel its strengths outweigh the fact that the company shows low profit margins.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 15.9%. Since the same quarter one year prior, revenues slightly increased by 1.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Although ALL's debt-to-equity ratio of 0.25 is very low, it is currently higher than that of the industry average.
  • Net operating cash flow has slightly increased to $1,383.00 million or 1.39% when compared to the same quarter last year. In addition, ALLSTATE CORP has also vastly surpassed the industry average cash flow growth rate of -64.48%.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and the Insurance industry average. The net income has decreased by 16.8% when compared to the same quarter one year ago, dropping from $781.00 million to $650.00 million.
  • You can view the full analysis from the report here: ALL
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NSM

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7. Nationstar Mortgage Holdings Inc. (NSM)
Industry: Financial Services/Mortgage REITs
Year-to-date return: -54%

Credit Suisse's Target Price: $25

Credit Suisse Target Said: We see NSM offering an attractive valuation with a potential sale of a minority stake in Xome (formerly Solutionstar) acting as a catalyst to highlight this value. With Xome's valuation crystalized, this should highlight the substantial discount to book value the mortgage bank currently trades at this point in time. With $8-12/share in value for Xome, this leaves about $3-7/share in value for the mortgage banking (servicing and origination) business at today's stock price. This represents 16-43% of current book value. Improving servicing profitability in the back half of the year will set the backdrop for the improved mortgage banking valuation.

TheStreet Said: TheStreet Ratings team rates NATIONSTAR MORTGAGE HOLDINGS as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

We rate NATIONSTAR MORTGAGE HOLDINGS (NSM) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Thrifts & Mortgage Finance industry. The net income has significantly decreased by 159.6% when compared to the same quarter one year ago, falling from $111.23 million to -$66.34 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Thrifts & Mortgage Finance industry and the overall market, NATIONSTAR MORTGAGE HOLDINGS's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for NATIONSTAR MORTGAGE HOLDINGS is currently extremely low, coming in at 14.57%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -13.01% is significantly below that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 61.25%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 150.81% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • NATIONSTAR MORTGAGE HOLDINGS has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, NATIONSTAR MORTGAGE HOLDINGS increased its bottom line by earning $2.44 versus $2.41 in the prior year. For the next year, the market is expecting a contraction of 65.2% in earnings ($0.85 versus $2.44).
  • You can view the full analysis from the report here: NSM
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GGP

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8. General Growth Properties (GGP)
Industry: Financial Services/REITs
Year-to-date return: 2%

Credit Suisse's Target Price: $33

Credit Suisse Target Said: General Growth Properties (GGP) is our top pick across the REIT space (Outperform, $33 TP). The valuation is compelling with the company trading at a 10% discount to NAV (compared with a 1% discount for SPG, its closest peer). Moreover, its large development/redevelopment pipeline will drive significant FFO growth in the coming years. As of 2Q15, GGP had a $1.0B capital budget for its development pipeline. The projects are expected to deliver a ~9% blended return, stabilize at a 5.0% cap rate, and generate $700M in development accretion.

TheStreet Said: TheStreet Ratings team rates GENERAL GROWTH PPTYS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate GENERAL GROWTH PPTYS INC (GGP) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • GENERAL GROWTH PPTYS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, GENERAL GROWTH PPTYS INC increased its bottom line by earning $0.39 versus $0.30 in the prior year. This year, the market expects an improvement in earnings ($1.41 versus $0.39).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 66.0% when compared to the same quarter one year prior, rising from $74.61 million to $123.85 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, GENERAL GROWTH PPTYS INC's return on equity exceeds that of both the industry average and the S&P 500.
  • 44.43% is the gross profit margin for GENERAL GROWTH PPTYS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 20.13% trails the industry average.
  • You can view the full analysis from the report here: GGP
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DFS

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9. Discover Financial Services (DFS) - Get Discover Financial Services Report
Industry: Financial Services/Specialty Finance
Year-to-date return: -13.9%

Credit Suisse's Target Price: $68

Credit Suisse Target Said: We believe that Discover represents the best combination of strong operating fundamentals and valuation among the large card issuers. The company is returning the vast majority of earnings, and appears to be positioning the network to be a source of value to shareholders.

TheStreet Said: TheStreet Ratings team rates DISCOVER FINANCIAL SVCS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

We rate DISCOVER FINANCIAL SVCS INC (DFS) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • DFS's revenue growth has slightly outpaced the industry average of 5.4%. Since the same quarter one year prior, revenues slightly increased by 1.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • DISCOVER FINANCIAL SVCS INC reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, DISCOVER FINANCIAL SVCS INC reported lower earnings of $4.90 versus $4.96 in the prior year. This year, the market expects an improvement in earnings ($5.30 versus $4.90).
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Consumer Finance industry and the overall market on the basis of return on equity, DISCOVER FINANCIAL SVCS INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • The debt-to-equity ratio is very high at 2.11 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • You can view the full analysis from the report here: DFS
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ITG

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10. Investment Technology Group Inc. (ITG)
Industry: Financial Services/Trust Banks, M&A Advisors & Market Technology
Year-to-date return: -18.2%

Credit Suisse's Target Price: $19

Credit Suisse Target Said: The recent management update about client town halls affirms and recent appointment of the new CEO Frank Troise reaffirms our belief that the impact of the SEC settlement will be temporary, the position of the franchise as a key provider of dark liquidity remains intact and the lost share and capture rate will recover as clients gradually reinstate ITG as a routing venue -- management notes that conversations here have been constructive. All in, we continue to believe the firm is cyclically well-positioned to succeed in Europe and still has the free options we noted in our initiation report: 1) M&A 2) outsourcing of clearing and 3) success of POSIT FX remain intact.

TheStreet Said: TheStreet Ratings team rates INVESTMENT TECHNOLOGY GP INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate INVESTMENT TECHNOLOGY GP INC (ITG) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and poor profit margins.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • ITG's revenue growth has slightly outpaced the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 1.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 172.91% to $48.75 million when compared to the same quarter last year. In addition, INVESTMENT TECHNOLOGY GP INC has also vastly surpassed the industry average cash flow growth rate of 79.46%.
  • INVESTMENT TECHNOLOGY GP INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, INVESTMENT TECHNOLOGY GP INC increased its bottom line by earning $1.40 versus $0.81 in the prior year. For the next year, the market is expecting a contraction of 44.1% in earnings ($0.78 versus $1.40).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Capital Markets industry. The net income has significantly decreased by 179.0% when compared to the same quarter one year ago, falling from $12.93 million to -$10.21 million.
  • The share price of INVESTMENT TECHNOLOGY GP INC has not done very well: it is down 14.39% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
  • You can view the full analysis from the report here: ITG