Markets

Validea's Top Five Financial Stocks Based On David Dreman - 10/6/2019

The following are the top rated Financial stocks according to Validea's Contrarian Investor model based on the published strategy of David Dreman. This contrarian strategy finds the most unpopular mid- and large-cap stocks in the market and looks for improving fundamentals.

PACWEST BANCORP (PACW) is a mid-cap value stock in the Regional Banks industry. The rating according to our strategy based on David Dreman is 91% 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: PacWest Bancorp is a bank holding company for Pacific Western Bank (the Bank). The Company is focused on relationship-based business banking to small, middle-market and venture-backed businesses. As of October 23, 2017, the Bank offered a range of loan and deposit products and services through 83 branches located throughout the state of California, one branch located in Durham, North Carolina, and several loan production offices located in cities across the country. The Company provides commercial banking services, and deposit and treasury management services to small and middle-market businesses. It offers products and services through its CapitalSource and Square 1 Bank divisions. In addition, the Company provides investment advisory and asset management services to select clients through Square 1 Asset Management, Inc., a subsidiary of the Bank.

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.

MARKET CAP: PASS
EARNINGS TREND: PASS
EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS
P/E RATIO: PASS
PRICE/CASH FLOW (P/CF) RATIO: FAIL
PRICE/BOOK (P/B) VALUE: PASS
PRICE/DIVIDEND (P/D) RATIO: PASS
PAYOUT RATIO: PASS
RETURN ON EQUITY: FAIL
PRE-TAX PROFIT MARGINS: PASS
YIELD: PASS

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

UMPQUA HOLDINGS CORP (UMPQ) is a mid-cap value stock in the Regional Banks industry. The rating according to our strategy based on David Dreman is 90% 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: Umpqua Holdings Corporation is a bank holding company. The Company's principal operating subsidiaries include Umpqua Bank (the Bank) and Umpqua Investments, Inc. (Umpqua Investments). It operates through two segments: Community Banking and Home Lending. The Community Banking segment's principal business focus is the offering of loan and deposit products to business and retail customers in its primary market areas. As of December 31, 2016, the Community Banking segment operated 346 locations throughout Oregon, California, Washington, Idaho and Nevada. The Home Lending segment originates, sells and services residential mortgage loans. The Company offers a range of traditional and digital financial products. Its products and services include Deposit Products, Private Bank, Broker Dealer and Investment Advisory Services, Commercial Loans and Leases and Commercial Real Estate Loans, and Consumer Loans.

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.

MARKET CAP: PASS MARKET CAP: PASS
EARNINGS TREND: PASS EARNINGS TREND: PASS
EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS
P/E RATIO: PASS P/E RATIO: PASS
PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: FAIL
PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS
PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: FAIL
PAYOUT RATIO: PASS PAYOUT RATIO: PASS
RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL
PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS
YIELD: PASS YIELD: PASS

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

BANCO BILBAO VIZCAYA ARGENTARIA SA (ADR) (BBVA) is a large-cap value stock in the Money Center Banks industry. The rating according to our strategy based on David Dreman is 86% 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: Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) is a diversified financial company engaged in retail banking, wholesale banking, asset management and private banking. Its segments include Banking Activity in Spain, Real Estate Activity in Spain, the United States Turkey, Mexico, South America and Rest of Eurasia. Its Banking Activity in Spain segment includes Retail Network in Spain, Corporate and Business Banking (CBB), and BBVA Seguros and Asset Management units in Spain. Its Real Estate Activity in Spain segment covers specialist management of real-estate assets in the country. In the United States it offers services through, BBVA Compass Bancshares Inc. and the BBVA New York branch. The Turkey segment represents its stake in the Turkish bank, Turkiye Garanti Bankasi A.S. It offers banking and insurance businesses in Mexico. In South America, it provides banking and insurance businesses. The Rest of Eurasia segment includes business activity in the rest of Europe and Asia.

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.

MARKET CAP: PASS MARKET CAP: PASS MARKET CAP: PASS
EARNINGS TREND: PASS EARNINGS TREND: PASS EARNINGS TREND: PASS
EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: FAIL
P/E RATIO: PASS P/E RATIO: PASS P/E RATIO: PASS
PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: PASS
PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS
PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: FAIL PRICE/DIVIDEND (P/D) RATIO: PASS
PAYOUT RATIO: PASS PAYOUT RATIO: PASS PAYOUT RATIO: PASS
RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL
PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS
YIELD: PASS YIELD: PASS YIELD: PASS

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

FS KKR CAPITAL CORP (FSK) is a mid-cap value stock in the Misc. Financial Services industry. The rating according to our strategy based on David Dreman is 86% 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: FS KKR Capital Corp, formerly FS Investment Corporation is an externally managed, non-diversified, closed-end management investment company. The Company's investment objectives are to generate current income and long-term capital appreciation. Its portfolio consists primarily of investments in senior secured loans and second lien secured loans of the private United States middle market companies and subordinated loans of the private United States companies. It may purchase interests in loans or make other debt investments, including investments in senior secured bonds, through secondary market transactions in the over-the-counter market or directly from target companies as primary market or directly originated investments. It invests in a range of industries, including capital goods; consumer services; consumer durables and apparel; materials; commercial and professional services, and diversified financials. Its investment advisor is FB Income Advisor, LLC.

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.

MARKET CAP: PASS MARKET CAP: PASS MARKET CAP: PASS MARKET CAP: PASS
EARNINGS TREND: PASS EARNINGS TREND: PASS EARNINGS TREND: PASS EARNINGS TREND: FAIL
EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: FAIL EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: FAIL
P/E RATIO: PASS P/E RATIO: PASS P/E RATIO: PASS P/E RATIO: PASS
PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: PASS PRICE/CASH FLOW (P/CF) RATIO: PASS
PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS
PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: FAIL PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: PASS
PAYOUT RATIO: PASS PAYOUT RATIO: PASS PAYOUT RATIO: PASS PAYOUT RATIO: PASS
RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL RETURN ON EQUITY: PASS
PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS
YIELD: PASS YIELD: PASS YIELD: PASS YIELD: PASS

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

ING GROEP NV (ADR) (ING) is a large-cap value stock in the Regional Banks industry. The rating according to our strategy based on David Dreman is 86% 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: ING Groep N.V. (ING) is a financial institution. The Company offers banking services. The Company's segments include Retail Netherlands, which offers current and savings accounts, business lending, mortgages and other consumer lending in the Netherlands; Retail Belgium, which offers products that are similar to those in the Netherlands; Retail Germany, which offers current and savings accounts, mortgages and other customer lending; Retail Other, which offers products that are similar to those in the Netherlands, and Wholesale Banking, which offers wholesale banking activities (a full range of products from cash management to corporate finance), real estate and lease. The Company's Retail Banking business lines provide products and services to individuals, small and medium-sized enterprises (SMEs) and mid-corporates. ING's banking activities in Australia are undertaken by ING Bank (Australia) Limited (trading as ING Direct) and ING Bank NV Sydney Branch.

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.

MARKET CAP: PASS MARKET CAP: PASS MARKET CAP: PASS MARKET CAP: PASS MARKET CAP: PASS
EARNINGS TREND: PASS EARNINGS TREND: PASS EARNINGS TREND: PASS EARNINGS TREND: FAIL EARNINGS TREND: FAIL
EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: FAIL EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: FAIL EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: PASS
P/E RATIO: PASS P/E RATIO: PASS P/E RATIO: PASS P/E RATIO: PASS P/E RATIO: PASS
PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: FAIL PRICE/CASH FLOW (P/CF) RATIO: PASS PRICE/CASH FLOW (P/CF) RATIO: PASS PRICE/CASH FLOW (P/CF) RATIO: PASS
PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS PRICE/BOOK (P/B) VALUE: PASS
PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: FAIL PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: PASS PRICE/DIVIDEND (P/D) RATIO: PASS
PAYOUT RATIO: PASS PAYOUT RATIO: PASS PAYOUT RATIO: PASS PAYOUT RATIO: PASS PAYOUT RATIO: PASS
RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL RETURN ON EQUITY: FAIL RETURN ON EQUITY: PASS RETURN ON EQUITY: FAIL
PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS PRE-TAX PROFIT MARGINS: PASS
YIELD: PASS YIELD: PASS YIELD: PASS YIELD: PASS YIELD: PASS

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

Since its inception, Validea's strategy based on David Dreman has returned 117.04% vs. 196.96% for the S&P 500. For more details on this strategy, click here

About David Dreman: Dreman's Kemper-Dreman High Return Fund was one of the best-performing mutual funds ever, ranking as the best of 255 funds in its peer groups from 1988 to 1998, according to Lipper Analytical Services. At the time Dreman published Contrarian Investment Strategies: The Next Generation, the fund had been ranked number one in more time periods than any of the 3,175 funds in Lipper's database. In addition to managing money, Dreman is also a longtime Forbes magazine columnist.

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.