The research firm said it has buy or strong buy ratings on 36 of the 85 financial stocks in the S&P 500 compared to just two sell ratings. S&P Capital IQ has four-star ratings on American International Group (NYSE: AIG), Citigroup (NYSE: C), J.P. Morgan Chase (NYSE: JPM) and U.S. Bancorp (NYSE: USB) and a five-star rating on Warren Buffett’s Berkshire Hathaway (NYSE: BRK-B). Those stocks combine for 29.3% of XLF’s weight. The ETF earns an overweight rating from S&P Capital IQ.
Insurance ETFs, which have been solid this year despite being frustrated by not getting the benefit of an interest rate boost from the Federal Reserve, also look like value propositions. [Insurance ETFs Wait on Higher Interest Rates]
The iShares US Insurance ETF (NYSEArca: IAK), which features a large combined allocation to American International Group, MetLife (NYSE: MET), Prudential (NYSE: PRU) and Dow component Travelers (NYSE: TRV), is a value bet as those stocks are viewed as undervalued by S&P Capital IQ. The research firm has a five-star rating on Travelers and a four-star rating on MetLife.
Financial Select Sector SPDR
