For those looking to find strong Finance stocks, it is prudent to search for companies in the group that are outperforming their peers. Barclays (BCS) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Finance peers, we might be able to answer that question.
Barclays is one of 870 individual stocks in the Finance sector. Collectively, these companies sit at #1 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.
The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Barclays is currently sporting a Zacks Rank of #1 (Strong Buy).
Over the past 90 days, the Zacks Consensus Estimate for BCS' full-year earnings has moved 34.4% higher. This is a sign of improving analyst sentiment and a positive earnings outlook trend.
Based on the most recent data, BCS has returned 18.1% so far this year. Meanwhile, the Finance sector has returned an average of 4.3% on a year-to-date basis. As we can see, Barclays is performing better than its sector in the calendar year.
One other Finance stock that has outperformed the sector so far this year is Bank of Montreal (BMO). The stock is up 6.1% year-to-date.
In Bank of Montreal's case, the consensus EPS estimate for the current year increased 8.1% over the past three months. The stock currently has a Zacks Rank #2 (Buy).
Breaking things down more, Barclays is a member of the Banks - Foreign industry, which includes 68 individual companies and currently sits at #138 in the Zacks Industry Rank. On average, stocks in this group have gained 9.2% this year, meaning that BCS is performing better in terms of year-to-date returns. Bank of Montreal is also part of the same industry.
Barclays and Bank of Montreal could continue their solid performance, so investors interested in Finance stocks should continue to pay close attention to these stocks.
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This article originally published on Zacks Investment Research (zacks.com).
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