The banks are in trouble again. US prosecutors are weighing up criminal charges against HSBC, amid news that the bank may have helped wealthy clients across the world evade millions of pounds in tax. Of course, this is not the first time banks have been under the spotlight. Last November, Channel 4's Economics Editor tweeted that he was "sick" of covering banking scandals (as this interesting video shows). This latest controversy will no doubt continue to unfold over the coming days and weeks, but in the meantime, Stockopedia takes a look at companies in the Financial sector that are qualifying for the GuruScreens.
London Stock Exchange (LSE)
London Stock Exchange (LSE) has benefited from a string of IPOs that took place in 2014, to the advantage of the LSE's capital market units, where revenues grew by 13% in the six months ending November 2014. The LSE also released a bullish trading statement on 18 December, noting that the average daily volume of equity traded increased by 12% in the UK and 16% in Italy. Higher trading volumes are of course good news for stock exchanges, which charge trading fees as shares are bought and sold. The market has responded well to this news. Indeed, the LSE has (somewhat paradoxically) beaten the market by 28% over the last year and qualifies for Stockopedia's Value Momentum Screen - which tries to uncover stocks that are bargain priced but are beating the market.
Aviva (AV.)
Aviva (AV.) also qualifies for the Value Momentum Screen, having beaten the market by nearly 13% this year, while retaining a PEG ratio of just 0.2. Earnings have grown by 22% over the last twelve months, but the company has a P/E ratio of 15.6. The FTSE average is 17.8. Why is Aviva relatively cheap? Demand for annuities in the UK has fallen dramatically since budgetary bills were introduced, removing certain requirements for annuity purchases by U.K. pensioners. Furthermore, in November Aviva entered negotiations to buyout Friends Life, the life insurance provider. Some investors could be concerned that this acquisition could hamper Aviva's growth, given the highly regulated nature of the UK life market. The other side of the coin is that Friends Life is…
