tsla

2 Bank Stocks in Danger of Downgrades

Fidelity National Information Services Inc (NYSE:FIS) and ICICI Bank Ltd (ADR) (NYSE:IBN) haven't performed as well as other bank stocks since the presidential election

Dec 16, 2016 at 9:28 AM
facebook X logo linkedin


Bank stocks have ranked among the top sectors since the presidential election. However, shares of some financial firms have underperformed. For contrarians like us, the key is in finding stocks where there is a disconnect between performance and sentiment. In this case, both Fidelity National Information Services Inc (NYSE:FIS) and ICICI Bank Ltd (ADR) (NYSE:IBN) appear to be overloved, relative to how they've fared on the charts.

Take, for example, FIS. At $77.35, the stock has barely budged since the election. In fact, the shares are one of only a few within the banking sector not perched above the 80-day moving average.

Not to mention, the $80 level has begun to materialize as a layer of resistance, capping the stock's late-November gains. Moreover, with a burst of buy-to-open activity yesterday at the January 2017 80-strike call, the position is now home to peak open interest among all FIS options. This could potentially reinforce resistance over the next month.

That hasn't stopped Wall Street from growing extremely bullish toward Fidelity National Information Services Inc. Nearly 90% of analysts tracking the stock have doled out a "buy" or better recommendation. If the shares fail to make a meaningful move higher, a round of downgrades could intensify selling pressure.

IBN is another bank stock residing below its 80-day trendline. This wasn't the case prior to the election, but since then, the shares have retreated 6.6% to trade at $7.66

If there's a silver lining to be found, it's that IBN recently touched its 160-day moving average. This is the sixth occurrence over the past three years, and returns have historically been bullish after the fact. Specifically, the stock has averaged a 21-day post-signal gain of 5.3%, with 60% positive.

That said, ICICI Bank Ltd could be in trouble if it fails to bounce. While only two analysts track the shares, both have handed out a "strong buy" recommendation. In other words, IBN may be vulnerable to a round of downgrades and/or bearish analyst initiations.

Let us help you profit from market volatility. Target big gains in short order with a 30-day trial of Schaeffer's Weekly Volatility Trader!

 

Two High-Octane Trade Ideas. One Simple Goal: Intraday Profits.

Dynamite Day Trading Signals delivers two same-day options trades every week — powered by proprietary intraday analysis and 43+ years of trading expertise.

But this isn’t just another stream of alerts.

It’s a structured plan with clear entry and exit points – designed for traders who want to act fast, trade smart, and wrap up gains before the closing bell.

No guesswork. No overnight exposure – Just two well-researched setups per week — whether you prefer buying premium or selling it.

And the results speak for themselves: subscribers have locked in +245.8% total profit over the last six months (since inception!).

👉 Start your one-month trial now for just $10, and be ready for the next trade alert.