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Quarter-End Insights

Financial Services: Best Values in Stocks With Elevated Near-Term Risks

Investors have to be pickier with financial-services stocks this quarter.

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The Morningstar U.S. Financial Services Index rose 1% quarter to date through Sept. 24, in line with the market as a whole (Exhibit 1). Overall, the median U.S.-based financial-services stock trades at about a 2% discount to our fair value estimate, so we consider the U.S. financial sector slightly undervalued.

Financials have recovered from the beginning of the year. - source: Morningstar

Michael Wong does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.