Dividend Investor Insights: Five Financial Investments to Purchase for Income

You are receiving this email because you signed up to receive our free e-letters, or you purchased a product or service from its publisher, Eagle Financial Publications. Five Financial Investments to Purchase for Income 08/02/2024 [Sponsored Content [Warning signs flashing again in the market](]( I put my personal money to work last September as the market pulled back. Did the same in April. Now, I'm rearing up to buy more as my #1 indicator is flashing for another pullback. I've used this #1 indicator since 1997. It let me and my readers know to sell in February 2020 before the Covid crash. The indicator is free to use and easy to overlay on your charts. [Here's my #1 indicator to try out now.]( [Click Here...]([1pxtrans]( Five [financial investments]( to purchase for [income]( and share price gains give investors a way to profit from rates cuts the Federal Reserve is signaling that it will start in September. New quarterly earnings reports are showing selected financial stocks are outperforming expectations. With technology stocks pulling back after a run upward, companies involved in investing, insurance and financial technology services are gaining interest. The five financial investments to purchase offer increased potential opportunity for pursuing potent profits. Investment banks, insurance companies and financial technology companies all benefit when interest rates fall and the spread widens between the rates of money they receive and the funds they pay out. “Prior to World War II, price inflation was temporary and caused by wars,” wrote Mark Skousen, PhD, in the August 2024 issue of his [Forecasts & Strategies]( investment newsletter. “But since World War II, inflation has become permanent, a result of creating the Federal Reserve in 1913, abandoning the gold standard in 1933 and 1971, adopting Keynesian economics and deficit finance and engaging in never-ending wars engulfing the United States.” Skousen’s conclusion is that inflation will persist and he provided the chart below as proof. Five Financial Investments to Purchase for Income: Goldman Sachs (GS) New York-based investment firm Goldman Sachs (NYSE: GS) is regarded as a strong “buy” recommendation of BofA Global Research. Goldman Sachs, a stock that I personally have owned for years, received a $563 price target from BofA. Goldman Sachs Chief Executive Officer David Solomon met with BofA banking analysts recently and highlighted “significant opportunities” to drive growth and improve returns. The analysts wrote a July 30 research note indicating the stock offers among the best “risk-reward” prospects in their coverage area and positive earnings per share (EPS) revisions. The BofA banking analysts wrote the Solomon discussed plans for gaining market share, fending off competition, navigating regulatory changes and driving Goldman Sachs toward an improved and durable return on equity (ROE). The CEO cited three key catalysts to boost the performance of dividend-paying Goldman’s stock. Courtesy of [www.StockRover.com](. Learn about Stock Rover by [clicking here](. One catalyst is the likely pick-up in mergers and acquisition (M&A) activity, the BofA analysts wrote. A “backlog” of such potential deals is growing. Indeed, BofA wrote that M&A deal value is tracking 3.0% of S&P market cap year to date (YTD) vs. 9.0% for a five-year, pre-pandemic median. Post-election, no matter who wins the presidency, and Fed rate-cuts should serve as catalysts to boost EPS revisions, the analysts wrote. A pick-up in investment banking activity has high correlation to ROE, further supporting the stock’s price-to-earnings multiple expansion, according to the research note. Chart courtesy of [www.stockcharts.com](. [[Millionaires Will Be Minted OVERNIGHT]( Legendary tech futurist who predicted the rise of Amazon, Netflix, and Apple YEARS in advance now says: “The biggest, most profitable technological advances in the future will ALL stem from this single breakthrough. Millionaires will be minted overnight.” [He’s revealing EVERYTHING here.]( [Click Here...]( Five Financial Investments to Purchase for Income: Asset Management Boost Solomon cited the leadership position of Goldman Sachs in asset management, including private credit, the BofA analysts wrote. In addition to secular growth tailwinds in private credit and wealth, the company's Asset and Wealth Management (AWM) business is a margin improvement story, they added. Margin improvement, plus rising contribution from AWM to the bottom line, portend improved ROE and higher stock multiples, BoA wrote in its research note. Despite a recent setback during the Fed’s annual stress-test, actions taken to de-risk Goldman Sachs balance sheet should lead to lowered capital requirements over the medium term, the BofA analysts opined. Notwithstanding operating at elevated capital levels, Goldman Sachs delivered ROE of 13.3% in the first half of 2024, after adjusting for roughly a 50 basis points drag from enterprise platforms, the analysts added. “We consider any significant stock market correction that puts into question EPS/ROE upside from the rebounding investment banking activity as a near-term risk, but view any potential pullback as offering a particularly attractive buying opportunity,” the BofA analysts wrote. Skousen has been recommending Goldman Sachs in his [Forecasts & Strategies]( investment newsletter’s Flying Five portfolio that consists of his five favorite dividend-paying, bargain-priced stocks since July 23, 2023. As of July 30, the share price had risen 55.07% before factoring dividend payments. With $11 per share in dividends paid by Goldman Sachs since the time of the recommendation in the [Forecasts & Strategies]( investment newsletter, the total return on the investment of close to 50%. Skousen also recommended a financial stock in his [TNT Trader]( advisory service on Monday, July 30 to profit from the industry's ascent. Ben Franklin scion Mark Skousen, who heads [TNT Trader]( talks to Paul Dykewicz. Five Financial Investments to Purchase for Income: Aon Corp. (AON) London-based Aon plc (NYSE: AON), a global risk management and human capital services provider, received an “outperform” rating from Chicago-based investment banking firm William Blair. Aon reported an 18% jump in its second-quarter 2024 revenues of $3.8 billion. That gain included a 6% rise in internal organic revenue growth. Also in the second quarter, Aon completed its acquisition of NFP, a middle-market provider of risk, benefits, wealth and retirement plan advisory solutions, for $13 billion enterprise value. Aon further rewarded its shareholders by repurchasing 0.8 million of its class A ordinary shares for approximately $250 million. The risk-management company also announced what it described as a first-of-its kind, public-private solution to build insurance capacity and accelerate new capital investments and recovery in Ukraine, bringing total capacity to $350 million. William Blair wrote that Aon’s second-quarter cash earnings per share of $2.93 rose 6%, but missed the investment firm’s $3.03 estimate and consensus forecast of $3.09. The shortfall stemmed mainly from a higher-than-expected tax rate attributed to discrete items and geographical mix, the investment firm wrote. “Organic growth appears to have turned the corner, and potential for increased middle-market M&A activity could modestly raise the top-line growth profile,” William Blair’s analysts wrote. Chart courtesy of [www.stockcharts.com](. Five Financial Investments to Purchase for Income: Erie Indemnity (ERIE) Erie Indemnity Co. (NASDAQ: ERIE), of Erie, Pennsylvania, provides a variety of insurance products to its customers that include auto, homeowners’ coverage and business insurance. It also is engaged in providing life insurance, long-term care rider insurance, Medicare supplement and personal umbrella insurance. Erie reported operating earnings per share of $3.17 for the second quarter. Premium growth keeps accelerating as an effect of rate actions. Despite rising premium prices, new business and retention levels remain strong, according to the William Blair investment firm that tracks the stock and rates it as “outperform.” The investment firm projects Erie’s top-line growth will remain in the mid- to high-teen percentages. Erie’s policy issuance margin has been increasing as a result of investments in technology efficiency and should remain strong going forward as commission costs stay consistent as a percentage of premiums and technology drives down expenses, William Blair’s analysts wrote in a recent research note. Investment operations are an added benefit, with yields rising to 6% in the quarter, the analysts added. The combination of growing management fee income and investment income should allow Erie Indemnity to maintain a positive earnings performance through 2025, with William Blair’s estimates suggesting growth in the 20% to 30% range. Chart courtesy of [www.stockcharts.com](. Five Financial Investments to Purchase for Income: SS&C Technologies (SSNC) SS&C Technologies Holdings, Inc. (NASDAQ: SSNC), a Windsor, Connecticut-based financial services and heath care technology company, also received an “outperform” rating from William Blair. The company delivered better-than-forecast results in the second quarter by reporting an adjusted earnings per share of $1.27, compared to the investment firm’s estimate of $1.21 and analysts’ consensus target of $1.20. The stock offers a “good opportunity” to buy into a financial services software and outsourcing franchise that offers both a “growth story” and an “attractive valuation,” William Blair analyst Jeff Schmitt wrote in a recent research note. The stock trades at only 12 times the investment firm’s 2025 EPS estimate, compared to an average forward price-to-earnings (P/E) ratio of 16 times during the last decade. Chart courtesy of [www.stockcharts.com](. The investment firm indicated its estimate could be “conservative” if mergers and acquisitions (M&A) activity picks up. For the long-term, William Blair wrote that SS&C’s consistent fundamentals and M&A strategy will drive strong top- and bottom-line momentum. “Key risks include exposure to equity markets, key-man risk, increasing competitive levels, client consolidation, deal integration risk and a dependence on acquisitions for a substantial portion of growth,” William Blair wrote. A big plus is that SS&C’s organic growth is improving from price hikes and strength in its core businesses, William Blair wrote in its research note. SS&C is on pace for EPS growth of 12% in 2024, the investment firm added. [[It's hot gains season](Â]( Exciting trades are exploding. With Nvidia's record-breaking surge making it the world's most valuable public company, the market is heating up with opportunities. The excitement around A.I.'s potential is creating waves that elite Options traders are riding to big wins. Want to know how top Options traders leverage A.I. for these gains?  Our complimentary live session will reveal the strategies and tools they use to stay ahead. Join over 100,000 traders who have already attended and benefited from this training and [Discover how top Options traders leverage A.I. in July for big wins](. [Click Here...]( Five Financial Investments to Purchase for Income: Featured Fund (XLF) Another fan of financial stocks is Jim Woods, who heads the [Successful Investing]( newsletter and co-leads the [Fast Money Alert]( advisory service. Woods recently recommended a [financial services fund]( Financial Select Sector SPDR ETF (XLF), in his weekly update, [Successful Investing]( hotline. Jim Woods leads [Successful Investing]( and co-heads [Fast Money Alert](. Woods placed his XLF recommendation in [Successful Investing]('s Tactical Trends Portfolio. XLF includes shares in all the biggest banks and financial institutions in the market, he wrote to his subscribers. Those financial stocks help to track a key sector in an exchange-traded fund (ETF) pegged to closely match the industry’s fortunes. Certain market forecasters are predicting at least two Federal Reserve interest rate cuts by year-end. Investors are taking notice and rotating their money into sectors such as financial services that benefit from a reduced-rate environment. Launched by State Street in 1998, XLF seeks to mirror the performance of the Financial Select Sector Index, featuring S&P 500 financial stocks which are weighted by market cap. XLF generally invests at least 95% of its total assets in the securities comprising the index. Its cap-weighted portfolio avoids small-caps, focusing on large banks and other formidable financial institutions. Almost 80% of XLF’s holdings are in finance, with another 18% held in commercial services. In addition, 95%-plus of its holdings are based in the United States, allowing XLF to offer efficient exposure to the industry heavyweights. Top XLF holdings include Berkshire Hathaway’s B-class shares (NYSE: BRK.B), JPMorgan Chase (NYSE: JPM), Visa (NYSE: V), Mastercard (NYSE: MA), Bank of America (NYSE: BAC), Wells Fargo & Co. (NYSE: WFC) and Goldman Sachs Group Inc. The five financial investments to purchase for income offer potential for investors to profit powerfully as interest rates are forecast to be cut by the Federal Reserve starting in September. The expected interest rate cuts are a key reason why financial investments appear to positioned for putting into personal portfolios. Sincerely, Paul Dykewicz, Editor [DividendInvestor.com]( About Paul Dykewicz: Paul Dykewicz is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of [StockInvestor.com]( and [DividendInvestor.com]( a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul also is the author of an inspirational book, "[Holy Smokes! Golden Guidance from Notre Dame's Championship Chaplain](", with a foreword by former national championship-winning football coach Lou Holtz. Follow Paul on Twitter [@PaulDykewicz](. mailto:CustomerService@EagleFinancialPublications.com About Us: Eagle Financial Publications is located in Washington, D.C. – only a few blocks from the Capitol. Our products have been helping investors build their wealth for several decades. Whether you’re a long-term investor or short-term trader, you’ll find the right strategy for you, including how to earn more steady income to spend now, preserve and grow your capital to enjoy later, and whatever other investment goals you have. Visit Our Websites: - [StockInvestor.com]( - [DividendInvestor.com]( - [DayTradeSPY.com]( - [CoveredCall]( - [MarkSkousen.com]( - [GilderReport.com]( - [BryanPerryInvesting.com]( - [JimWoodsInvesting.com]( - [InvestmentHouse.com]( - [RetirementWatch.com]( - [SeniorResource.com]( - [GenerationalWealthStrategies.com]( - [InvestInFiveStarGems.com]( - [[YouTube] Visit our YouTube Channel - Eagle Investing Network]( To ensure future delivery of Eagle Financial Publication's emails please add the domain @info2.eaglefinancialpublications.com to your address book or contact list. This email was sent to [{EMAIL}](MAILTO:{EMAIL}) because you are subscribed to the Eagle Stock Investor Insights List. To unsubscribe please click [here](. To instantly stop receiving emails simply click [here](. View this email in your [web browser](. If you have questions, please send them to [Customer Service](mailto:customerservice@eaglefinancialpublications.com?SUBJECT=Question about _ELETTERS Stock Investor Insights). © Eagle Financial Publications - Eagle Products, LLC. - a Salem Communications Holding Company. All rights reserved. 122 C Street NW, Suite 515 | Washington, D.C. 20001 [1pxtrans]( [Link](