5 Oversold Finance Stocks to Buy on the Rebound

More market jitters hit stocks this month, and this time the damage is leaking into the financial services sector. As usual, AI disruption was the catalyst, and several of the largest finance-sector stocks dropped 10% to 20% over just a few days.

AI disruption is certainly no surprise to investors anymore. Still, this way this reaction unfolded suggests it was more about profit-taking and high valuations than any actual AI-influenced obsolescence.

If this selloff is overdone, several prominent finance stocks are trading at steep discounts from where they were at the start of the month.

Today, we'll look at 5 stocks that suffered large February drawdowns that could be on the verge of rebounding. Each stock has strong underlying fundamentals and multiple technical signals indicating an oversold market.

Blackstone Inc.

Blackstone (NYSE:BX) seems to face a new negative headline every week. From private credit weakness to potential housing regulations to AI disruption, BX shares have taken more hits this month than the Canadian men's hockey team. However, the world's largest alternative asset manager has several bullish factors working in its favor.

For starters, the company recently reported record assets under management (AUM) of $1.2 trillion, a quarterly increase of more than 10% year-over-year (YOY). Blackstone also hiked its dividend payment to $1.49 at the end of January, a boost of more than 15% and a sign of considerable financial health. And finally, the stock received new coverage from RBC Capital this week, which initiated the stock as a Buy with a $179 price target (potential upside of more than 35%).

The stock is also showing multiple technical signs of being oversold on the daily chart. The share price has dipped below the lower Bollinger Band, an event that has turned into a buying signal in the previous two instances. The Relative Strength Index (RSI) also shows the stock is oversold at 27, hinting that this drawdown is losing momentum.

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MSCI Inc.

MSCI (NYSE:MSCI) sold off this month following several AI-focused headlines, including a new tax-prep tool from AI finance platform Hazel and a Citrini Research substack on AI disruption. The stock dropped nearly 20% in just a few sessions before cooler heads prevailed and a rebound began, which could still be a great opportunity for new investors. MSCI is an integral part of the market's plumbing, and its research and indices are tied to trillions of dollars in assets.

The demand for the company's services is as robust as ever; MSCI reported record revenue of over $822 million in Q4 2025 as inflows into equity funds linked to MSCI indices reached record highs. The company's sales grew 10% YOY, which puts a dent in the theory that AI will absorb investment research clients.

MSCI didn't sell off as hard as some other financial firms, but the chart is flashing several bullish technical signals, including a bullish cross on the Moving Average Convergence Divergence (MACD) indicator. The stock has bounced firmly off the oversold level on the RSI, and the 200-day simple moving average (SMA) is likely the next key level for investors to watch.

Moody's Corp.

The drawdown in Moody's (NYSE:MCO) stock is likely to be short-lived once investors realize AI disruption will do little to slow the company's growth. In its Q4 2025 report last week, Moody's announced its fourth consecutive top and bottom line beat, including sales growth of more than 13% YOY. The total 2025 revenue of $7.7 billion was an annual record, and the company's own AI analytics projects continue to provide recurring revenue. Moody's also announced a 10% dividend increase in its Q4 2025 report, marking the 16th consecutive year it has boosted its payout.

MCO shares are flashing oversold signs across both the Bollinger Bands and the RSI, plus a bullish crossover on the MACD. This confluence of signals halted the stock's drawdown at 22% and triggered a new uptrend, which is now approaching a crucial level at the 20-day moving average in the middle Bollinger Band.

Charles Schwab Corp.

Charles Schwab (NYSE:SCHW) is another asset manager that was struck by the new Hazel update, but this is another scenario where the headlines don't seem to match the story. Tax preparation services account for just a fraction of Schwab's sales; the most significant sources of revenue are asset management fees and interest income.

The stock lost more than 13% over just over two weeks despite reporting record EPS of $1.39 in its Q4 2025 report in January, and shares trade at just 20 times earnings following the drop.

SCHW shares are still in a downtrend and recently took out the 200-day SMA, a typically bearish signal. However, this could be a bear trap based on overblown selling. The downward pressure is fading, and the RSI is starting to flatten after nearly triggering an oversold signal. With selling momentum getting weaker, the uptrend could resume with vigor if the stock can retake the 200-day SMA.

Stifel Financial Corp.

Stifel Financial (NYSE:SF) is a diversified financial services company that offers wealth management, retirement planning, and tax and estate planning services to a range of private and institutional clients. The company's stock joined the financial rout with a 12% decline over the last month, even after reporting strong Q4 results earlier this year and announcing a 3-to-2 stock split (scheduled for this Friday). Both revenue and EPS numbers set records in Q4, and Stifel reported record sales of $5.5 billion in 2025. Like Schwab, tax prep services account for only a small portion of Stifel's revenue, and its reputation as a recruiter of high-value advisors adds a loyalty factor that AI startups can't match.

The widening Bollinger Bands usually mean increased volatility, but the oversold signals are flashing brightly. Both the RSI and the lower Bollinger Band have entered oversold territory, suggesting an eventual reversal. However, short-term volatility is likely to persist, and investors should ease into positions in SF shares until a reversal is confirmed.