5 Best Financial Stocks To Buy Now

In this article, we will take a look at the 5 best financial stocks to buy now. If you want to explore similar stocks, you can go to 15 Best Financial Stocks To Buy Now.

5. Bank of America Corporation (NYSE:BAC)

Number of Hedge Fund Holders: 100

Bank of America Corporation (NYSE:BAC) was spotted on 100 hedge funds’ portfolios at the end of Q4 2022. These funds held collective positions worth $37.5 billion in the company. As of December 31, Berkshire Hathaway is the largest investor in the company and holds a stake worth $33.4 billion.

On April 12, Barclays analyst Jason Goldberg updated his price target on Bank of America Corporation (NYSE:BAC) to $39 from $48 and reiterated an Overweight rating on the shares. The stock is one of the best financial stocks to buy now according to analysts and hedge funds.

Oakmark Funds made the following comment about Bank of America Corporation (NYSE:BAC) in its Q1 2023 investor letter:

“The Oakmark Equity and Income Fund has 29% of its equity portfolio in financials. This made the March sell-off painful, but we do not believe that this has meaningfully changed the value of most of our financial equity holdings. In fact, we were adding to financial positions throughout March. We believe that one way to analyze our financial holdings is to look at them in different buckets given their various business models and risk profiles. Almost 30% of our financial exposure is in insurance companies and insurance brokers. Insurance companies have very stable liability profiles, so the main risk is a change in asset values. We are comfortable with their investment portfolios and think these stocks are quite attractive. Around 5% of our financials are asset managers. This leaves a little over 40% of the financials exposure in a varied group of banks and lenders. About 5% of that portfolio is in Bank of America Corporation (NYSE:BAC) and State Street. These two banks are designated as Systematically Important Financial Institutions and are held to higher regulatory standards. Our largest single financials holding is Bank of America, which has grown deposits during March, and we believe it is one of the best managed companies in the sector.”

4. Berkshire Hathaway Inc. (NYSE:BRK-B)

Number of Hedge Fund Holders: 110

On February 25, Berkshire Hathaway Inc. (NYSE:BRK-B) reported earnings for the fiscal fourth quarter of 2022. the company reported an EPS of $3.06 and generated a revenue of $78.17 billion, up 8.87% year over year.

As of April 14, Berkshire Hathaway Inc. (NYSE:BRK-B) has returned 15.42% to investors over the past 6 months. The stock is placed fourth among the best financial stocks to buy now.

110 hedge funds disclosed having stakes in Berkshire Hathaway Inc. (NYSE:BRK-B) at the end of Q4 2022. The total value of these stakes amounted to $15.7 billion. As of December 31, Bill & Melinda Gates Foundation Trust is the top shareholder in the company and has a stake worth $7.6 billion.

3. PayPal Holdings, Inc. (NASDAQ:PYPL)

Number of Hedge Fund Holders: 115

At the end of the fourth quarter of 2022, 115 hedge funds were long PayPal Holdings, Inc. (NASDAQ:PYPL) and disclosed stakes worth $5.1 billion in the company. Of those, Citadel Investment Group was the leading stockholder in the company and held a stake worth $481 million.

PayPal Holdings, Inc. (NASDAQ:PYPL) is one of the best financial stocks to buy now. This February, BMO Capital analyst James Fotheringham revised his price target on PayPal Holdings, Inc. (NASDAQ:PYPL) to $108 from $117 and reiterated an Outperform rating on the shares.

Renaissance Investment Management made the following comment about PayPal Holdings, Inc. (NASDAQ:PYPL) in its Q4 2022 investor letter:

“Another underperformer in the quarter was PayPal Holdings, Inc. (NASDAQ:PYPL). Despite reporting solid third quarter operating results and announcing new payment agreements with both Apple and Amazon.com, the company guided for a slowdown in e-commerce activity, partly reflecting weakened consumers who are dealing with heightened inflation. However, we still expect growth in PayPal’s core payments platforms to improve in upcoming quarters, driven by easier year-over-year comparisons.”

2. Mastercard Incorporated (NYSE:MA) 

Number of Hedge Fund Holders: 139

Wall Street sees material upside to Mastercard Incorporated (NYSE:MA). On January 30, Mizuho analyst Dan Dolev raised his price target on Mastercard Incorporated (NYSE:MA) to $405 from $380 and reiterated a Buy rating on the shares. The stock has gained 26.23% over the past 6 months, as of April 14, and is one of the best financial stocks to buy now.

At the end of Q4 2022, 139 hedge funds were eager on Mastercard Incorporated (NYSE:MA) and disclosed collective positions of $15.6 billion in the company. Of those, Akre Capital Management was the top investor in the company and disclosed a position worth $2 billion.

Oakmark Funds made the following comment about Mastercard Incorporated (NYSE:MA) in its Q1 2023 investor letter:

“A brief discussion of Mastercard Incorporated (NYSE:MA) is also appropriate given we have held this company for nearly 13 years. It’s the 13th-largest contributor to performance for the Fund in our nearly 24-year history, but the largest in total dollars and percentage terms at nearly 1760%. While a terrific company, there were better priced alternatives in the quarter, so we sold our position. Our history with Mastercard fits the adage that all good things must come to an end.”

1. Visa Inc. (NYSE:V)

Number of Hedge Fund Holders: 177

Visa Inc. (NYSE:V) was a part of 177 investors’ portfolios at the close of Q4 2022. These funds disclosed collective stakes worth $26.4 billion in the company. As of December 31, TCI Fund Management is the most prominent shareholder in the company and has a stake worth $4.1 billion.

On January 29, Barclays analyst Ramsey El-Assal raised his price target on Visa Inc. (NYSE:V) to $270 from $266 and reiterated an Overweight rating on the shares. As of April 14, the stock has returned 12.84% to investors year to date. Visa Inc. (NYSE:V) is placed high among the best financial stocks to buy now.

Here is what Baron Funds had to say about Visa Inc. (NYSE:V) in its Q4 2022 investor letter:

“Shares of global payment network Visa Inc. (NYSE:V) increased after reporting strong quarterly results, with 19% growth in revenue and EPS despite currency headwinds and the suspension of operations in Russia. Payment volume grew 16% in local currency (excluding Russia and China) with notable strength in cross-border volumes driven by rebounding international travel. Management also provided encouraging guidance for the next fiscal year. We continue to own the stock due to Visa’s long runway for growth and significant competitive advantages.”

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily enewsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below. You can also take a look at 13 Best Emerging Market Stocks to Buy and 12 Cheap Utility Stocks to Buy According to Analysts.