Financial firms serve as the backbone of the economy, providing essential services from lending and investment management to risk management and payment processing. These companies have benefited from improving market activity and economic fundamentals, so it's no surprise the industry has posted a 9.9% gain over the past six months, nearly mirroring the S&P 500.
Nevertheless, investors should tread carefully as many firms are cyclical due to their leverage and exposure to regulatory changes. Keeping that in mind, here is one financials stock poised to generate sustainable market-beating returns and two best left ignored.
Two Financials Stocks to Sell:
P10 (PX)
Market Cap: $1.35 billion
Operating as a bridge between institutional investors and hard-to-access private market opportunities, P10 (NYSE:PX) is an alternative asset management firm that provides access to private equity, venture capital, impact investing, and private credit opportunities in the middle and lower middle markets.
Why Does PX Fall Short?
- Low return on equity reflects management’s struggle to allocate funds effectively
P10’s stock price of $12.28 implies a valuation ratio of 12.9x forward P/E. Read our free research report to see why you should think twice about including PX in your portfolio.
Western Union (WU)
Market Cap: $2.83 billion
With a history dating back to 1851 when it began as a telegraph company, Western Union (NYSE:WU) is a global money transfer service that enables consumers and businesses to send funds across borders and currencies, typically within minutes.
Why Do We Think WU Will Underperform?
- Annual sales declines of 3.6% for the past five years show its products and services struggled to connect with the market during this cycle
- Earnings per share were flat over the last five years and fell short of the peer group average
- Negative return on equity shows management lost money while trying to expand the business
Western Union is trading at $8.77 per share, or 4.8x forward P/E. If you’re considering WU for your portfolio, see our FREE research report to learn more.
One Financials Stock to Buy:
Oxford Lane Capital (OXLC)
Market Cap: $1.72 billion
Offering monthly dividend payments to income-focused investors, Oxford Lane Capital (NASDAQ:OXLC) is a closed-end management investment company that primarily invests in collateralized loan obligation (CLO) equity and debt securities.
Why Should You Buy OXLC?
- Annual revenue growth of 28.1% over the last two years was superb and indicates its market share increased during this cycle
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
At $3.71 per share, Oxford Lane Capital trades at 3.9x trailing 12-month price-to-sales. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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