3 US Financial Stocks Facing The Biggest Pressure From Higher Rates

Inflation is still running hot, the Boston Fed is talking about extra tightening, and rate markets are starting to price in more than one hike. When borrowing costs keep climbing, some large U.S. financial stocks feel the pinch while others find fresh ways to earn. This piece examines how that tension plays out and highlights 3 large-cap banks and brokers that screens suggest are especially exposed to the latest Fed signals.

The three large caps below are just a sample, and the full screen surfaced 25 more U.S. banks and brokers with equally compelling stories that are not covered here. To go straight to the source, use the US Large-Cap Financials (Banks & Brokers) screener to identify, filter, and analyze the highest conviction ideas that fit your own criteria.

Blue Owl Capital (OWL)

Overview: Blue Owl Capital is a New York based alternative asset manager focused on private credit, GP stakes, and real estate solutions that link directly to rate sensitive lending and financing activity.

Operations: Blue Owl Capital generates around US$3.1b from asset management services to clients, with all reported revenue currently coming from the United States.

Market Cap: US$15.3b

Blue Owl Capital matters in this banks and brokers themed screen because it offers a pure play way to tap into credit spreads and private financing at scale. The analyst consensus Narrative on Simply Wall St frames how that permanent capital model could translate into fee based earnings power over time.

"Significant ongoing growth in permanent capital vehicles, particularly through expansion in private credit, real assets, and evergreen and interval fund strategies, is still providing a larger base of recurring management fee revenue for Blue Owl Capital and keeps the potential for higher fee related earnings and durable margin expansion alive."

The real test lies in how one unresolved shift in fundraising appetite and redemption behavior ultimately filters through to those future margins.

That margin path is exactly what the full narrative for Blue Owl Capital unpacks. It maps how Blue Owl Capital’s permanent capital could accelerate or stall under different rate and fundraising scenarios.

Moody's (MCO)

Overview: Moody’s is a global risk assessment firm that rates debt and sells analytics software and data to financial institutions.

Operations: Moody’s generates about US$3.7b from Moody’s Analytics and US$4.6b from Moody’s Investors Service, with most revenue coming from the United States and EMEA.

Market Cap: US$87.3b

Moody’s fits this banks and brokers themed screen as a kind of picks and shovels provider for credit markets, and according to prajeeshprathap, an investor in the Simply Wall St Community, that role is evolving as risk analytics demand grows with each rate and credit cycle turn.

"What makes the story even stronger today is that Moody’s is no longer only a ratings company; over the past decade, management has steadily built Moody’s Analytics into a major recurring-revenue software and data business. This segment now contributes roughly 40% of revenue and acts as a stabilizer during weaker bond issuance environments."

The real hinge for Moody’s is how one quiet shift in debt issuance patterns and refinancing appetite ultimately feeds through to pricing power.

That pricing power question is exactly what the full narrative for Moody's tackles. It includes where Moody’s earnings engine could accelerate or stall as issuance patterns keep shifting.

Houlihan Lokey (HLI)

Overview: Houlihan Lokey is a global investment bank that advises on M&A, capital raising, restructuring and valuation, giving investors exposure to deal and restructuring cycles as financial conditions tighten.

Operations: Houlihan Lokey generates about US$1.7b from Corporate Finance, US$504m from Financial Restructuring, and US$360m from Financial and Valuation Advisory, across US$1.8b in U.S. revenue and US$793m internationally.

Market Cap: US$10.0b

For this banks and brokers themed screen, Houlihan Lokey matters because it is a pure advisory stock. It can see more work when higher rates and tighter credit spur M&A restructurings and complex financing, and the analyst consensus Narrative on Simply Wall St argues that backdrop could be a meaningful revenue opportunity.

"Sustained elevated restructuring activity, now supported by widening credit spreads and higher default rates among smaller private credit borrowers, is reinforcing the role of Financial Restructuring as a stabiliser for group revenue and net margins."

What really moves the needle from here is how one shift in large deal completion rates versus costs ultimately shapes Houlihan Lokey’s margins.

That margin story is where things get interesting, and the full narrative for Houlihan Lokey shows how Houlihan Lokey’s deal flow, restructuring work and costs could be decoupling in investors’ favor.

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