1. Itaú Unibanco Holding S.A. (NYSE:ITUB)
Share Price as of the close of January 3: $4.87
Number of Hedge Fund Holders: 26
Itaú Unibanco Holding S.A. (NYSE:ITUB) is a Brazilian financial services company, headquartered in Sao Paulo. It is the largest banking institution in Latin America, with over $555 billion in assets in 2023, and enjoys a global presence across 19 countries. According to Brand Finance, ITUB is also the most valuable company in Latin America, valued at $8.7 billion as of 2023.
ITUB operates as a full-service, universal bank, offering a wide range of services through several channels. Through its business partnerships, it is able to provide regular discounts, promotions, and other exclusive advantages to its customers to address their daily activities beyond the banking ecosystem.
On November 5, Itaú Unibanco Holding S.A. (NYSE:ITUB) announced financial results for the third quarter of fiscal 2024. It reported quarterly managerial recurring results of BRL 10.7 billion, up 20% year-over-year. The consolidated return on equity (ROE) stood at 22.7%, while in Brazil it was measured at 23.8%. The company’s loan portfolio was also up 1.9% from the last quarter, and 10% compared to the third quarter of 2023.
ITUB’s financial margin with clients was also up 8.2% from last year, reflecting the company’s impressive revenue generation capacity. Another highlight from the quarter was that Itaú Unibanco Holding S.A. (NYSE:ITUB) met its 2019 goal of reaching BRL 400 billion in structuring capital markets operations a year and a half early, in June 2024, instead of the end of 2025.
The company has also been working to enhance its digital presence. It has decided to do away with having seven different apps with separate login methods to two apps, the Super App and Ion, with a single login method. This should help improve customers’ digital experience.
Wall Street analysts are bullish on the stock, with a consensus Buy rating. They also anticipate an average uptick of 47% in Itaú Unibanco Holding S.A. (NYSE:ITUB)’s share price. Investor sentiment continues to improve as well. According to Insider Monkey’s database for Q3 2024, 26 hedge funds had a stake in the company, up from 25 at the end of the second quarter.
Overall, ITUB ranks first among the 10 best bank penny stocks to buy according to hedge funds. While we acknowledge the potential of banking companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ITUB but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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