10 Financial Stocks To Own Ahead Of A Fed Rate Hike: Credit Suisse

With the prospect of the Federal Reserve’s first interest rate hike looming large, Credit Suisse released a report this week with top buy ideas within the financial sector. Ten Credit Suisse analysts each picked their top financial stock to buy right now one of 10 different financial subsectors.

Here’s a full list of the names they chose.

1. Asset Managers: Affiliated Managers Group Inc AMG

Analyst Craig Siegenthaler like’s the company’s “strong organic growth rate” and believes that the company is poised for “positive EPS revisions and valuation expansion.”

2. Large Cap Banks: JPMorgan Chase & Co JPM

Analyst Susan Katzke sees continuing fundamental outperformance from JP Morgan and praises the company’s “willingness to optimize its balance sheet and capital deployment.”

3. Mid Cap Banks: KeyCorp KEY

Analyst Jill Shea predicts that the company will return 92 percent of capital to shareholders in 2015 and forecasts 5 percent operating EPS growth.

4. Brokers, Exchanges & Alternative Asset Managers: The Charles Schwab Corp SCHW

Analyst Christian Bolu sees up to 30 percent earnings accretion from the company over the next two to three years even if interest rates remain at current levels, which seems like an overly cautious forecast.

5. Insurance-FG & Life: MetLife Inc MET

Analyst Tom Gallagher believes the stock is currently undervalued “given improved visibility on capital returns and continuation of organic growth in international markets.”

6. Insurance-P&C: Allstate Corp ALL

Analyst Ryan Tunis sees a potential sale of the runoff life business funding $1.5 billion in share buybacks.

7. Mortgage REITs: PennyMac Mortgage Investment Trust PMT

Analyst Doug Harter sees an “attractive risk reward opportunity” given that the REIT is trading at a 15.1 percent discount to book value and pays a 13.9 percent dividend.

8. REITs: Simon Property Group Inc SPG

Analyst Ian Weissman argues that the REIT “should trade at a premium to peers given its solid portfolio, strong balance sheet, and distinguished management team.”

9. Specialty Finance: Discover Financial Services DFS

Analyst Moshe Orenbuch sees the company as “the best combination of strong operating fundamentals and valuation among the large card issuers.”

10. Trust Banks, M&A Advisors & Market Technology: Investment Technology Group Inc ITG

Analyst Ashley Serrao believes that “the firm is cyclically well-positioned to benefit from Europe,” and feels that the removal of the company’s former CEO should alleviate client fears about illegitimate activity.