Deutsche Bank’s top sector picks for Q3 ranked by their SA Quant ratings (part 1)

Posted on by wpadmin
The office building of CVS Health at its Corporate Headquarters at 1 CVS Dr, Woonsocket, RI, USA

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Deutsche Bank this week updated its Fresh Money Quarterly list, spotlighting top investment ideas to hold over the next year in different U.S. sectors.

Below is a list of those picks in the financial and healthcare sectors ranked by their Seeking Alpha Quant ratings, along with Deutsche Bank’s commentary:

Consumer

See the top picks here.

Financials and Fintech

  1. Synchrony (NYSE:SYF) – DB: “With SYF still trading at only ~7.5x forward EPS and over 2.5 turns below peer COF on 2027E EPS, which fully integrates the accretion from the DFS acquisition, and with nearly all key earnings drivers inflecting positively, we see this as a compelling opportunity.” Seeking Alpha Quant rating: Buy 4.47.
  2. Welltower (NYSE:WELL) – DB: “We are BUY rated on WELL as we believe the company will continue to deliver outsized performance in 2025, driven by consistent execution, targeted acquisitions, and favorable supply-demand tailwinds across senior housing.” Seeking Alpha Quant rating: Hold 3.42.
  3. PNC Financial Services (NYSE:PNC) – DB: “Mega banks have generally outperformed regionals given more exposure to trading and credit card, and on optimism for more capital relief than smaller banks. However, we also sense the market has been concerned about sluggish fee trends at PNC in recent years. We expect fees should rebound in 2Q/beyond which would be favorable to the shares.” Seeking Alpha Quant rating: Hold 3.22.
  4. Corebridge Financial (NYSE:CRBG) – DB: “Corebridge is a catalyst-rich stock that benefits from secular and cyclical tailwinds. Baby Boomers are reaching peak retirement age and are expected to live longer into retirement, providing a multi-year boost to demand for retirement solutions, which are core to CRBG’s offering.” Seeking Alpha Quant rating: Hold 3.04.
  5. TransUnion (NYSE:TRU) – DB: “TransUnion has evolved from a traditional credit bureau into a leading data and analytics provider. The company holds strong positions in sectors like identity and fraud protection, digital marketing, and fintech, along with exposure to various fast-growing emerging markets.” Seeking Alpha Quant rating: Hold 3.01.
  6. Webster Financial (NYSE:WBS) – DB: “We believe capital is strong and can be deployed in different scenarios, credit has been solid, the balance sheet is positioned to be mostly neutral to rates and be more defensive in a lower rate environment, loan growth should remain better relative to peers, and the valuation remains attractive.” Seeking Alpha Quant rating: Hold 2.93.
  7. Blackstone (NYSE:BX) – DB: “With Consensus now expecting 2-3 rate cuts for this year, which could help stimulate real estate prices and aid monetizations (most recent report for 2Q is above our estimate), we think the setup positions BX well for an acceleration of Y/Y fee-related earnings (FRE) growth in 2Q and 3Q25 and we forecast strong FRE growth at over 25% in 2026-27.” Seeking Alpha Quant rating: Hold 2.86.

Healthcare

  1. CVS Health (NYSE:CVS) – DB: “After a turbulent 2023 – 2024, marked by MA missteps, elevated medical cost trends, and regulatory scrutiny in pharmacy and PBM, CVS has reoriented with rationalized assumptions, heightened financial discipline, and tactical flexibility.” Seeking Alpha Quant rating: Hold 3.49.
  2. Danaher (NYSE:DHR) – DB: “In our view, the stock has both offensive and defensive characteristics. Offensive with potential earnings estimates revision, favorable end-market exposure, and capital deployment. Defensive with margin protection levers, cautious China outlook, limited U.S. A&G exposure, and ability to adjust supply chain to mitigate tariffs.” Seeking Alpha Quant rating: Hold 3.33.
  3. Edwards Lifesciences (NYSE:EW) – DB: “A multitude of meaningful pipeline milestones expected over the next several quarters will provide a steady stream of stock catalysts.” Seeking Alpha Quant rating: Hold 3.24.
  4. Eli Lilly (NYSE:LLY) – DB: “We rate LLY a Buy. While LLY’s Diabesity pipeline quality and optionality are not new to the Street, we think LLY’s separation from competitors (e.g., NVO) has widened following ADA25.” Seeking Alpha Quant rating: Hold 3.15.
  5. Alkermes (NASDAQ:ALKS) – DB: “We see favorable risk/reward for ALKS heading into 3Q25, with ALKS 2680, an orexin (OX2R agonist) candidate and a key growth driver for the company, approaching several major de-risking catalysts over the next several months.” Seeking Alpha Quant rating: Hold 3.07.
  6. Option Care Health (NASDAQ:OPCH) – DB: “Coming off a frustrating and challenging 2024 as potential Stelara headwinds dominated the narrative, we believe OPCH has the potential to turn the corner heading into 2026 as the Stelara headwind rolls off and the underlying fundamentals in chronic and acute come back into focus.” Seeking Alpha Quant rating: Hold 2.84.
  7. Concentra (NYSE:CON) – DB: “We view CON stock as a core holding for SMID-cap investors as the least exposed name to government pay, tariff, and geopolitics within our coverage. Recent M&A and claim growth at existing customers provide upside to 2025 organic growth estimates.” Seeking Alpha Quant rating: None.

More on the financial and healthcare sectors

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