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Validea's Top Five Financial Stocks Based On John Neff - 4/7/2019

The following are the top rated Financial stocks according to Validea's Low PE Investor model based on the published strategy of John Neff. This strategy looks for firms with persistent earnings growth that trade at a discount relative to their earnings growth and dividend yield.

ASSOCIATED BANC CORP (ASB) is a mid-cap value stock in the Regional Banks industry. The rating according to our strategy based on John Neff is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Associated Banc-Corp is a bank holding company. The Company, through its banking subsidiary Associated Bank, National Association (the Bank) and various nonbanking subsidiaries, provides a range of banking and non-banking products and services to individuals. The Company operates through three segments: Corporate and Commercial Specialty; Community, Consumer, and Business, and Risk Management and Shared Services. The Corporate and Commercial Specialty segment consists of lending and deposit solutions to businesses, developers, not-for-profits, municipalities and financial institutions. The Corporate and Commercial Specialty segment consists of lending and deposit solutions to businesses, developers, not-for-profits, municipalities and financial institutions. The Risk Management and Shared Services segment includes Corporate Risk Management, Credit Administration, Finance, Treasury, Operations and Technology, which are shared functions.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E RATIO: FAIL
EPS GROWTH: PASS
FUTURE EPS GROWTH: PASS
SALES GROWTH: PASS
TOTAL RETURN/PE: PASS
FREE CASH FLOW: PASS
EPS PERSISTENCE: PASS

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

BANK OF NEW YORK MELLON CORP (BK) is a large-cap value stock in the Regional Banks industry. The rating according to our strategy based on John Neff is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: The Bank of New York Mellon Corporation is a global investments company, which is focused on helping its clients manage and service their financial assets throughout the investment lifecycle. It provides financial services for institutions, corporations or individual investors. It allows clients to create, trade, hold, manage, service, distribute or restructure investments. It delivers Investment Management and Investment Services in 35 countries. It also has an Other segment, which includes the leasing portfolio, corporate treasury activities, derivatives and other trading, corporate and bank-owned life insurance and renewable energy investments, and business exits. As of September 30, 2018, the Company had $34.5 trillion in assets under custody and/or administration and $1.8 trillion in assets under management. It offers a range of actively managed equity and fixed income. It offers asset servicing, clearing services, issuer services and treasury services to its clients.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E RATIO: FAIL P/E RATIO: FAIL
EPS GROWTH: PASS EPS GROWTH: PASS
FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS
SALES GROWTH: PASS SALES GROWTH: PASS
TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS
FREE CASH FLOW: PASS FREE CASH FLOW: PASS
EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

CHEMICAL FINANCIAL CORPORATION (CHFC) is a mid-cap value stock in the Regional Banks industry. The rating according to our strategy based on John Neff is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Chemical Financial Corporation is a financial holding company. The Company operates in the commercial banking segment. The Company, through its subsidiary bank, Chemical Bank, offers banking and fiduciary products and services. These products and services include business and personal checking accounts, savings and individual retirement accounts, time deposit instruments, electronically accessed banking products, residential and commercial real estate financing, commercial lending, consumer financing, access to insurance and investment products, corporate and personal wealth management services, and other banking services. As of December 31, 2016, the Corporation and Chemical Bank served these markets through 249 banking offices. In addition to the banking offices, Chemical Bank operated eight loan production offices and over 272 automated teller machines, both on- and off-bank premises, as of December 31, 2016. Its loan portfolio includes commercial and real estate construction.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E RATIO: FAIL P/E RATIO: FAIL P/E RATIO: FAIL
EPS GROWTH: PASS EPS GROWTH: PASS EPS GROWTH: PASS
FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS
SALES GROWTH: PASS SALES GROWTH: PASS SALES GROWTH: PASS
TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS
FREE CASH FLOW: PASS FREE CASH FLOW: PASS FREE CASH FLOW: PASS
EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

DISCOVER FINANCIAL SERVICES (DFS) is a large-cap value stock in the Consumer Financial Services industry. The rating according to our strategy based on John Neff is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Discover Financial Services (DFS) is a direct banking and payment services company. The Company is a bank holding company, as well as a financial holding company. The Company operates through two segments: Direct Banking and Payment Services. It provides direct banking products and services, and payment services through its subsidiaries. It offers its customers credit card loans, private student loans, personal loans, home equity loans and deposit products. The Company's Direct Banking segment includes consumer banking and lending products, specifically Discover-branded credit cards issued to individuals and small businesses on the Discover Network and other consumer banking products and services. The Company's direct banking offers credit cards, student loans, personal loans, home equity loans, and other consumer lending and deposit products. The Payment Services segment includes PULSE, Diners Club and the Company's Network Partners business.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E RATIO: FAIL P/E RATIO: FAIL P/E RATIO: FAIL P/E RATIO: FAIL
EPS GROWTH: PASS EPS GROWTH: PASS EPS GROWTH: PASS EPS GROWTH: PASS
FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS
SALES GROWTH: PASS SALES GROWTH: PASS SALES GROWTH: PASS SALES GROWTH: PASS
TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS
FREE CASH FLOW: PASS FREE CASH FLOW: PASS FREE CASH FLOW: PASS FREE CASH FLOW: PASS
EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

FIRST FOUNDATION INC (FFWM) is a small-cap value stock in the Regional Banks industry. The rating according to our strategy based on John Neff is 81% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: First Foundation Inc. is a financial services holding company that provides a platform of personalized financial services to high net-worth individuals and their families, family businesses and other affiliated organizations. The Company conducts its operations through its subsidiaries, First Foundation Advisors (FFA) and First Foundation Bank (FFB), and First Foundation Insurance Services (FFIS), a subsidiary of FFB. The Company's segments include Banking, Investment Management and Wealth Planning (Wealth Management), and Other. The Banking segment includes the operations of FFB and FFIS, and Wealth Management segment includes the operations of FFA. The Company's integrated platform provides investment management, wealth planning, consulting, trust, banking products and services, life insurance services and property and casualty insurance services to meet the financial needs of its clients.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

P/E RATIO: FAIL P/E RATIO: FAIL P/E RATIO: FAIL P/E RATIO: FAIL P/E RATIO: FAIL
EPS GROWTH: PASS EPS GROWTH: PASS EPS GROWTH: PASS EPS GROWTH: PASS EPS GROWTH: PASS
FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS FUTURE EPS GROWTH: PASS
SALES GROWTH: PASS SALES GROWTH: PASS SALES GROWTH: PASS SALES GROWTH: PASS SALES GROWTH: PASS
TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS TOTAL RETURN/PE: PASS
FREE CASH FLOW: PASS FREE CASH FLOW: PASS FREE CASH FLOW: PASS FREE CASH FLOW: PASS FREE CASH FLOW: PASS
EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS EPS PERSISTENCE: PASS

For a full detailed analysis using NASDAQ's Guru Analysis tool, click here

Since its inception, Validea's strategy based on John Neff has returned 134.20% vs. 160.96% for the S&P 500. For more details on this strategy, click here

About John Neff: While known as the manager with whom many top managers entrusted their own money, Neff was far from the smooth-talking, high-profile Wall Streeter you might expect. He was mild-mannered and low-key, and the same might be said of the Windsor Fund that he managed for more than three decades. In fact, Neff himself described the fund as "relatively prosaic, dull, [and] conservative." There was nothing dull about his results, however. From 1964 to 1995, Neff guided Windsor to a 13.7 percent average annual return, easily outpacing the S&P 500's 10.6 percent return during that time. That 3.1 percentage point difference is huge over time -- a $10,000 investment in Windsor (with dividends reinvested) at the start of Neff's tenure would have ended up as more than $564,000 by the time he retired, more than twice what the same investment in the S&P would have yielded (about $233,000). Considering the length of his tenure, that track record may be the best ever for a manager of such a large fund.

About Validea: Validea is an investment research service that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.