With the Financial Select Sector SPDR down nearly 40% over the past year, it goes without saying that financial stocks haven't been getting much love lately. Some ticking time bomb stocks like MBIA (NYSE:MBI) and Fifth Third Bancorp (NASDAQ:FITB) have gotten hammered even more -- perhaps with good reason. But keep in mind that the healthy financial companies no one wants to touch may prove that ugly stocks make great opportunities.

With that in mind, I used our new CAPS screening tool to look for the most attractive stocks in the financial sector.

They also have:

  • Market capitalizations greater than $1 billion.
  • At least 300 active picks.
  • Five-star ratings, the highest possible, from our CAPS community.

Remember, in the first year for which we have data, CAPS' five-star companies outperformed the market with an average gain of nearly 28%.


Share Price

Market Cap (in billions)




Harvest Energy Trust (NYSE:HTE)






Montpelier RE (NYSE:MRH)



Penn West Energy Trust (NYSE:PWE)



Data from Motley Fool CAPS and Yahoo! Finance as of June 12.

Of course, screens are merely a first step in the stock-selection process. Discerning merely blemished stocks from their truly hideous brethren requires due diligence. Come and join us on Motley Fool CAPS to dig into these companies further. Our 105,000-strong (and counting) CAPS community can help you polish your portfolio.

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