Yahoo TV

The banking sector is in a unique time and place as investors navigate economic conditions, such as higher for longer interest rates held by the Federal Reserve. As part of Good Buy or Goodbye, Infrastructure Capital Advisors CEO Jay Hatfield joins Yahoo Finance's Julie Hyman in-studio to highlight the investment opportunities found in financial institutions, namely Goldman Sachs (GS)

Goldman is Hatfield's champion among investment banks, pointing to its year-to-date outperformance, its position as a derivative AI play, and IPO market forecasts.

"We think that the AI IPO boom will start in [2025], which it normally does because that's why the US capital markets are so efficient, is that high valuations of the public companies generate IPOs," Hatfield states. "So we think it's a little bit of a longer-term play. That's why even though the stock is working now, we don't think it's overvalued and even will get better as we go through the summer, have rate cuts at least from the ECB [European Central Bank], and then have a rally in '25."

On the other hand, Hatfield is bearish on regional banks, citing the higher rate environment and pressures on the credit market. 

Catch more of Yahoo Finance's Good Buy or Goodbye, or watch this full episode of Market Domination.

This post was written by Luke Carberry Mogan.