Bruce Harting, consumer finance analyst and managing director of Barclays Capital, told CNBC Wednesday that credit card companies are on the move. He recommends the sector, as stocks gained last week in response to the Fed's ruling on the Durbin Amendment.
"It's as much function of what they have going for them as to what they don't have," Harting said.
According to Harting, the macroeconomic numbers are starting to get better along with positive interest rates. He said consumer balance sheets have generally improved.
"Interchange fees can go higher on debit cards, and are not [yet] priced into the stocks," Harting added.
Harting's Top Stock Picks:
"They have all of the characteristics of growth at a reasonable price stock. So we have been recommending the sector," he said. In addition, "they have topline growth, bottomline growth, and improving spending," Harting added.
He noted that unlike other financial firms, the credit card companies don't have mortgage risk, foreclosure risk, or an "unknown number of additional capital they need to raise. They are all well capitalized and they don't have any Greece exposure or derivative exposure," which Goldberg said leaves this sector with room to rise.
Harting had been bullish on credit card stocks since the summer of 2009. ______________________________
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Bruce Harding owns no shares in the companies mentioned above. Barclays Capital is an investment banking client of AXP, Visa, COF, and DFS.