Laser Focus World is an industry bedrock—first published in 1965 and still going strong. We publish original articles about cutting-edge advances in lasers, optics, photonics, sensors, and quantum technologies, as well as test and measurement, and the shift currently underway to usher in the photonic integrated circuits, optical interconnects, and copackaged electronics and photonics to deliver the speed and efficiency essential for data centers of the future.

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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

1 Financials Stock to Target This Week and 2 We Turn Down

CACC Cover Image

Financial institutions play a critical role, offering everything from consumer banking to wealth management and specialized financial solutions. These companies have benefited from improving market activity and economic fundamentals, so it's no surprise the industry has posted a 9.5% gain over the past six months, nearly mirroring the S&P 500.

Although these firms have produced good results, only a handful will thrive over the long term as fintech disruptors are rapidly taking market share from the incumbents. Taking that into account, here is one resilient financials stock at the top of our wish list and two that may face trouble.

Two Financials Stocks to Sell:

Credit Acceptance (CACC)

Market Cap: $5.73 billion

Founded in 1972 by Donald Foss to serve customers overlooked by traditional lenders, Credit Acceptance (NASDAQ: CACC) provides auto financing solutions that enable car dealers to sell vehicles to consumers with limited or impaired credit histories.

Why Should You Sell CACC?

  1. Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
  2. Performance over the past two years shows each sale was less profitable, as its earnings per share fell by 10% annually
  3. High debt-to-equity ratio of 3.9× shows the firm carries too much debt relative to shareholder equity, increasing bankruptcy risk

At $510.01 per share, Credit Acceptance trades at 11.8x forward P/E. Dive into our free research report to see why there are better opportunities than CACC.

Ally Financial (ALLY)

Market Cap: $12.64 billion

Born from the former GMAC (General Motors Acceptance Corporation) and rebranded in 2010, Ally Financial (NYSE: ALLY) operates a digital-first bank offering auto financing, insurance, mortgage lending, and investment services to consumers and commercial clients.

Why Do We Think ALLY Will Underperform?

  1. Customers postponed purchases of its products and services this cycle as its revenue declined by 3.8% annually over the last two years
  2. Sales were less profitable over the last two years as its earnings per share fell by 8.9% annually, worse than its revenue declines
  3. Capital trends were unexciting over the last five years as its 1.7% annual tangible book value per share growth was below the typical financials firm

Ally Financial is trading at $40.82 per share, or 9x forward P/E. Read our free research report to see why you should think twice about including ALLY in your portfolio.

One Financials Stock to Buy:

Tradeweb Markets (TW)

Market Cap: $26.47 billion

Founded in 1996 as one of the pioneers in electronic bond trading, Tradeweb Markets (NASDAQ: TW) builds and operates electronic marketplaces that connect financial institutions for trading across rates, credit, equities, and money markets.

Why Should You Buy TW?

  1. Annual revenue growth of 25.9% over the last two years was superb and indicates its market share increased during this cycle
  2. Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 27.5% outpaced its revenue gains

Tradeweb Markets’s stock price of $124.01 implies a valuation ratio of 34.3x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

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