The recent rapid, steep, and fully unanticipated (at least by me) decline in regional banking stocks has been one of the primary culprits behind lackluster performance lately. But whenever one’s “investment boat gets rocked by a big wave,” so to speak, the most important thing to do is to remain disciplined and stick to the game plan while waiting for the choppy waters to level off a bit. I like Fifth Third Bancorp (FITB) here, says Nate Pile, editor of The Little River Investment Guide.
Those of you who have been following my ideas for a while already know that I am a big believer in the idea of always scaling-in to (or out of) positions over an extended period of time rather than doing so all at once. As is stated in the tag line for LRIG, my goal for the newsletter really is to help you get from here to there in retirement.
Along with the headaches high interest rates have caused for a number of regional banks and utility stocks, they are also one of the biggest concerns many of you have when it comes to both your investments and the economy in general.
I cannot promise that things won’t end up taking a serious turn for the worse in the months ahead. But I do want to remind you as part of this month’s pep talk that our job is to position our portfolios based on what the market is actually doing, not on what we think (or are worried) it might do.
At least for now, A) the market is going up, and B) the overall economy is still doing far better than the pessimists believe it should be doing. You are encouraged to remain as fully invested as you can be while still sleeping easy at night.
As for FITB, along with it being one of the oldest companies in the newsletter (it was founded in 1858), Fifth Third Bancorp is one of the largest and well-run regional banks in the country.
The company scores highly when it comes to the various ways that companies are being ranked on an “ethical” level these days, a trait that ought to help attract investors to the stock going forward. FITB is a buy under $30.
Recommended Action: Buy FITB.