One of my favorite things to do is buy up stocks from great companies that have, for one reason or another, gotten beaten up and are trading at a deep discount. Markets are a cyclical phenomenon for the most part – what goes up inevitably comes down, but the same is true in reverse.

Thanks to the recent banking crisis, a lot of finance industry stocks have gotten hammered, and despite the overall rally we’ve been enjoying, are still down significantly from their 2022 highs. Earnings season may not improve that state of affairs much, especially in the case of regional banks, who still have to reconcile the large amounts of debt they’re holding.

But there’s one company in particular that I’m looking at here as a “comeback king,” for a very simple reason – they’ve always been more of a brokerage than a bank. Their banking services exist mostly for the purpose of facilitating deposits for clients who use their brokerage services, rather than being a primary part of their business. So the risk of depositor flight is much less for them than with other institutions.

On top of that, this firm is the largest custodian for Registered Investment Advisors (RIAs) in the country, backstopping their trades and holding the assets for an RIA’s clients. And they’re constantly innovating to create products for clients that generate yields.

When a company like this is trading 40% lower than where it was in early 2022, it’s a real opportunity. The public’s shaken confidence in banks isn’t going to last forever, and when it fades, money is going to come flying back into this firm at speed. I could easily see it blasting back up to last year’s highs and beyond.

Check out this video for the ticker…

— Shah Gilani

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Source: Total Wealth