Over time, markets tend to trend higher, much like how the overall economy continues to move higher. And that should bode well for financial services, which help cater to a growing economy.
That can include banks, although banks can be subject to market fears. Insurance companies tend to be steady performers, but increasing natural disaster risks are leading to some concerns there. That leaves asset management as an ideal niche for investors in financial stocks today.
That’s best seen with BlackRock (BLK), the world’s largest asset manager. BlackRock just beat earnings, showing a 21% increase compared to the prior year, and revenues came in strong as well.
Plus, BlackRock sports a 32% profit margin, a high level reflecting a strong year for asset returns that looks likely to continue in 2025, any market volatility notwithstanding.
Overall, BlackRock shares have performed about in-line with the stock market, but shares still remain off their highs.
Action to take: Investors may like shares here or on any future market drop. BlackRock is likely to continue growing over time, and should continue to reward shareholders, particularly those who buy during periods of market fear.
At current prices, BlackRock also pays a 2.1% dividend.
For traders, the March $1,080 calls, last trading for about $10.50, could see mid-double-digit returns through the first quarter of 2025.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.