Within a few weeks of the earnings season, financial institutions and tech companies beat expectations and report impressive numbers. Fintech’s potential is enormous, and the transition toward digital payments has made the industry hot property. Several financial companies have reported impressive quarterly results, and financial stocks to buy are soaring. But this doesn’t mean you have missed the bus.
If there is a stock plunge, do not wait longer and pounce on it. These three financial stocks are the best in the industry, will earn you steady income through dividends, and will continue to report impressive results as the economy improves. The long-term potential of these three stocks is attractive. With that in mind, let’s look at the three financial stocks to buy whenever there is a dip.
Visa (V)
Up 5% year-to-date, Visa (NYSE:V) stock is trading at $271 today and was on an upward spree until March but has recently pulled back. One of the best financial stocks to buy, Visa is a global brand that caters to over 100 million merchants. With over 4 billion cards in circulation worldwide, Visa makes steady income through the fee it earns whenever the card is used. The company has nailed this business model, and its financials are proof of this.
In the recent quarter, Visa beat expectations again and reported net revenue of 8.8 billion, up 10% year-over-year, while the payments volume increased by 8%. The processed transactions soared 11%, driven by resilient consumer spending. A further improvement in consumer spending could mean higher revenue in the coming quarters.
Other than Europe, the company saw a 16% rise in cross-border volume, which shows its strong global position. Visa is also one of the best dividend stocks to own. While the dividend yield is modest at 0.77%, it has raised dividends annually for the past 16 years, and its 10-year dividend annualized growth rate is highly impressive at 18%.
Visa is an industry leader with a massive market share. It managed to thrive even during high inflation, which has set a rock solid momentum for 2024. Buy the stock whenever there is a dip, and you will never regret your decision. After the company announced results last week, half a dozen analysts raised their price target.
Morgan Stanley (MS)
Investment bank Morgan Stanley (NYSE:MS) excels in wealth management, and its numbers prove the same. This also helps the company remain resilient during times of economic downturn. Warren Buffet’s favorite investment, Morgan Stanley, is a dividend stock worth holding on to for the long-term.
Trading at $92 as of writing, the stock looks highly undervalued to me. It has risen 30% in the past six months and only 4% over the year. While it is very close to the 52-week high of $95, it can keep moving higher.
Morgan Stanley’s quarterly results show that investment banking has rebounded, and the company is building momentum for an excellent year ahead. Its wealth management unit grew by 5%, while the income from investment banking increased by 16%. The company reported a revenue of $15.14 billion and an EPS of $2.02, beating estimates.
The quarter saw a 138% surge in the EPS quarter-over-quarter and a 19% rise year-over-year. Despite a drop in the advisory revenue, Morgan Stanley saw a surge in debt underwriting revenue by over 100% YOY. The CEO stated, “The pipeline is clearly growing”.
The company pays a dividend of $0.85 per share and has a yield of 3.69%. It has increased dividends for 11 consecutive years, and the positive momentum in the business could lead to a steady dividend hike.
Once interest rates are reduced, the stock could rally. This dividend stock under $100 is a strong buy. Analysts have raised the price target of the stock after the results.
American Express (AXP)
American Express (NYSE:AXP) is another company that has beat expectations regarding quarterly results. It reported an 11% YOY revenue growth to hit $15.8 billion and an impressive 34% YOY net income growth.
This number captured the attention of investors since it led to a 39% jump in the EPS. The current financials prove that American Express is set to benefit from the increase in the use of debit and credit cards. This ensures growth in any economic cycle.
It added 3.4 million new cards in the quarter, and as the world steadily moves towards cashless payments, American Express will continue to benefit. The most interesting information in the quarterly results is the growing demand from Gen Z and millennials, making American Express highly attractive to this specific demographic. About 60% of the new consumer accounts were from Gen Z and millennials.
Trading at $238 today, this stock is up 26% YTD and 49% in the year. It has gone from $140 in October to $238 today. AXP stock is very close to the 52-week high, and any pullback is a solid buying opportunity. The management aims to see 9%-11% revenue growth through 2026. It is also a dividend stock with a yield of 1.17%.
Like the other two companies mentioned here, over half a dozen analysts have upgraded their price target for AXP stock after the blowout quarterly results.
On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.