Despite the uncertainty hindering the financial sector, there are a handful of strong banks that investors can buy, said Paul Miller, group head of financial services at FBR Capital Markets.
“There are a lot of headwinds out there for the banks and we think [the sector] is going to continue to drift until we get more certainty,” Miller told CNBC.
Still, Miller has an “outperform” rating on JPMorgan and said the firm has a “good balance sheet.”
He said this contrasts with capital issues weighing on banks such as Citigroup and Bank of America .
“We also have “buy” ratings on PNC Financial Services and USBancorp as well,” he added.
However, Miller said he is still concerned about the regional banks with large commercial real estate portfolios.
“Commercial real estate is going to take a longer drag, harder to get through, and it’s going to weigh on the regional [bank] valuations,” he commented.
Scorecard—What He Said:
- Miller's Previous Appearance on CNBC (Jan. 21, 2011)
More Market Intelligence:
- Where to Invest Amid Choppy Markets: Strategist
- Bank Stress Test Losers: How to Trade Them
- Greenberg: Comparing Today’s Market to 1999
CNBC Data Pages:
Miller does not own shares of WFC, BAC or JPM.