Large Cap Dividend-Paying Banks Exploding Higher on Rate Cut Hopes

One very positive item for investors when earnings season rolls around every quarter is that the big money center and investment banks are always among the first to report. This year was no different, as all the major financials were released early and, for the most part, all delivered outstanding numbers. As with all sectors, the tariffs are weighing on sentiment and affecting companies’ ability to provide forward guidance that they feel comfortable with. Following the solid reports for the second quarter, if we achieve some tariff resolution and geopolitical tensions subside, the rest of 2025 could be huge for the blue-chip giants that top Wall Street analysts favor.

While top Wall Street analysts are wary of the pitfalls that could face the top financial stocks for the rest of 2025, if tariffs and the economy combine to create headwinds for the sector, however, if things continue to smooth out, the top blue chips in the industry could produce some impressive total return numbers for growth and income investors. Add in the potential for rate cuts starting in September, and the banking index that tracks the largest 24 banks has surged to record highs for the first time in three years, and all the ingredients for a continued rally in the sector are in place.

We screened our 24/7 Wall St. research financial database list of strong buy stocks that top Wall Street firms are positive on, and four of the highest-yielding picks are outstanding ideas now.

Why do we cover blue-chip dividend financial stocks?

Dividend stocks offer investors a reliable source of passive income. Passive income is characterized by its ability to generate revenue without requiring the earner’s continuous active effort, making it a desirable financial strategy for those seeking to diversify their income streams or achieve financial independence.

Goldman Sachs

Goldman Sachs Group Inc. (NYSE: GS) is an American multinational investment bank and financial services company. The white-glove banking giant offers industry-leading strength and pays a reliable 2.15% dividend. It provides a range of financial services to corporations, financial institutions, governments, and individuals worldwide through three segments:

• Global Banking & Markets
• Asset & Wealth Management
• Platform Solutions

The Global Banking & Markets segment provides financial advisory services, including:

• Strategic advisory assignments related to mergers and acquisitions, divestitures, corporate defense activities, restructurings, and spin-offs
• Relationship lending, acquisition financing, and secured lending through structured credit and asset-backed lending and funding under securities-to-resale agreements

This segment also offers client execution activities for cash and derivative instruments, as well as credit and interest rate products, mortgages, currencies, commodities, and equities-related products, along with underwriting services.

The Asset & Wealth Management segment manages assets across various classes, including equity, fixed income, hedge funds, credit funds, private equity, real estate, currencies, and commodities.

It provides:

• Customized investment advisory solutions
• Wealth advisory services
• Personalized financial planning
• Private banking services
• Investments in corporate equity, credit, real estate, and infrastructure assets

The Platform Solutions segment offers credit cards and point-of-sale financing for the purchase of goods or services. It also provides cash management services, such as deposit-taking and payment solutions, for corporate and institutional clients.

Wells Fargo has assigned an Overweight rating and a target price of $785.

JPMorgan Chase

JPMorgan Chase & Co. (NYSE: JPM) is the fifth-largest bank in the world by assets. Its stock trades at a reasonable 12.5 times estimated 2026 earnings, and it offers a 1.87% dividend. JPMorgan is one of the leading global financial services firms and the largest banking institution in the United States, with approximately $3.9 trillion in assets. The company was formed by merging Chase Manhattan’s retail banking operations and J.P. Morgan’s investment banking operations.

The company operates through four segments:

• Consumer & Community Banking (CCB)
• Corporate & Investment Bank (CIB)
• Commercial Banking (CB)
• Asset & Wealth Management (AWM)

The CCB segment offers:

• Deposit, investment, and lending products
• Cash management, payments, and services
• Mortgage origination and servicing activities
• Residential mortgages and home equity loans
• Credit cards, auto loans, leases, and travel services are offered to consumers and small businesses through bank branches, ATMs, and digital and telephone banking

The CIB segment provides:

• Investment banking products and services, including corporate strategy and structure advisory, and equity and debt market capital-raising services
• Loan origination and syndication, payments, cash and derivative instruments, risk management solutions, prime brokerage, and research

This segment also offers securities services, including custody, fund accounting and administration, as well as securities lending products, for asset managers, insurance companies, and public and private investment funds.

The CB segment provides financial solutions, including lending, payments, investment banking, and asset management to small and midsized companies, local governments, nonprofit clients, and large corporations, as well as investors, developers, and owners of multifamily, office, retail, industrial, and affordable housing properties.

The AWM segment provides multi-asset investment management solutions, encompassing equities, fixed income, alternatives, and money market funds, to both institutional clients and retail investors. Additionally, it offers retirement products and services, brokerage, custody, estate planning, lending, deposit, and investment management services to high-net-worth clients.

Bank of America has a Buy rating with a $340 target price.

PNC Financial Services

PNC Financial Services Group Inc. (NYSE: PNC) is an American bank holding company and financial services corporation based in Pittsburgh, Pennsylvania. This bank has a vast client base and is among the top 10 largest U.S. banks by assets, and it pays investors a strong 3.30% dividend. PNC operates through three segments:

• Retail Banking
• Corporate & Institutional Banking
• Asset Management Group

The company’s Retail Banking segment offers:

• Checking, savings, and money market accounts, as well as time deposits
• Residential mortgages, home equity loans, and lines of credit
• Auto loans, credit cards, education loans, and personal and small business loans and lines of credit
• Brokerage, insurance, investment, and cash management services

This segment serves consumer and small business customers through branches, digital channels, ATMs, and phone-based customer contact centers.

The Corporate & Institutional Banking segment provides:

• Secured and unsecured loans, letters of credit, and equipment leases
• Cash and investment management services
• Receivables and disbursement management services
• Funds transfer services
• International payment services
• Access to online/mobile information management and reporting
• Securities underwriting, loan syndications, and customer-related trading
• Mergers and acquisitions, equity capital markets advisory-related services
• Commercial loan servicing and technology solutions

It serves mid-sized and large corporations as well as government and not-for-profit entities.

PNC Financial Services Group’s Asset Management Group segment offers:

• Investment and retirement planning, customized investment management, credit and cash management solutions, and trust management and administration services for high-net-worth and ultra-high-net-worth individuals and their families
• Multi-generational family planning services for ultra-high-net-worth individuals and their families

It provides outsourced chief investment officers, custody, private real estate, cash, fixed-income, and client solutions for retirement plans, as well as fiduciary investment services for institutional clients.

Bank of America’s price objective for the Buy-rated shares is $196.

Wells Fargo

Wells Fargo & Co. (NYSE: WFC) operates in 35 countries and serves over 70 million customers worldwide. This money-center giant makes sense, given its 2.18% dividend, as many of the issues that have plagued the company over the past five years appear to be resolved. Wells Fargo offers a diverse range of banking, investment, mortgage, and consumer and commercial finance products and services.

The company operates through four segments:

• Consumer Banking and Lending
• Commercial Banking
• Corporate and Investment Banking
• Wealth and Investment Management

The Consumer Banking and Lending segment offers a diverse range of financial products and services tailored to meet the needs of consumers and small businesses. These include checking and savings accounts, credit and debit cards, as well as home, auto, personal, and small business lending services.

The Commercial Banking segment provides financial solutions to private, family-owned, and specific public companies. Its products and services include banking and credit products across various industry sectors and municipalities, as well as secured lending and lease products, and treasury management services.

The Corporate and Investment Banking segment offers a suite of capital markets, banking, and financial products and services, such as:

• Corporate banking
• Investment banking
• Treasury management
• Commercial real estate lending and servicing
• Equity and fixed-income solutions
• Sales, trading, and research capabilities services to corporate, commercial real estate, government, and institutional clients

The Wealth and Investment Management provides wealth management, brokerage, financial planning, lending, private banking, and trust and fiduciary products and services to affluent, high-net-worth, and ultra-high-net-worth clients.

It also operates through financial advisors in brokerage and wealth offices, consumer bank branches, independent offices, and digitally through WellsTrade and Intuitive Investor.

The Goldman Sachs price target of $91 accompanies a Buy rating.

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