One savvy analyst sees a trio of bank stocks as healthy enough to survive the seemingly endless coronavirus pandemic.
“The industry has consistently passed Fed stress tests, which assume a severely adverse scenario,” Jason Goldberg, analyst at Barclays said in a note Tuesday, adding that even in a “challenging scenario,” banks in his coverage universe remain profitable.
And even against this backdrop in which a recession seems almost certain, analysts at Baird are still seeing specific opportunities in the nation’s big banks, Barron's said.
“While recession is now closer to our base case for 2020, we are optimistic there will be a recovery and see 30%-50% upside in bank stocks if investors can hold on until then,” David George, senior research analyst at Baird, said in a note on Tuesday in which he raised his ratings on Bank of America (BAC), U.S. Bancorp (USB), and Truist Financial (TFC).
While many average investors are obviously wary of parting with their hard-earned cash in such uncertain times, one financial guru offers a common-sense approach to finding bargain stocks in the economic rubble.
Investment guru Jim Cramer said savvy investors should take the recent stock-market plunge to start buying stocks in consumer goods “we can’t live without.”
The “Mad Money” host said on CNBC that defensive stocks can outperform the broader market during an economic downturn because there is constant demand for their products.
“Check out your medicine cabinet, check your refrigerator, look at your pantry,” Cramer said, noting that nearly any product that can be found in the supermarket would qualify.
He cited examples as Conagra Brands (CAG), J M Smucker (SJM) and Clorox (CLX).
“We should buy quality recession-proof stocks because that’s what works when the economy’s on hiatus,” Cramer said.
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