Interest Sensitive Stock

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Interest Sensitive Stock

A stock whose value is likely to increase or decrease substantially due to changes in interest rates. Most interest sensitive stocks represent publicly-traded companies with high rates of long-term debt. These companies' stocks decrease in value when interest rates rise because the higher cost of borrowing may result in lower profits and dividends. Conversely, their stocks rise on lower interest rates. For this reason, utility companies tend to have interest sensitive stocks.
References in periodicals archive ?
The Bank remains asset sensitive, meaning that net interest income is expected to increase in a rising interest rate environment.
Second, if you are too asset sensitive, consider reducing your existing holdings of fixed rate bonds.
Setting aside the loan growth and revenue issues, net interest margins continue to hold up well, and many of the large banks have positioned the balance sheet to be more asset sensitive and thus generate a net benefit from a rising interest rate environment.
Our asset sensitive position is positioned to actually take advantage of a mildly rising rate environment quite nicely.
A decrease in net interest margin resulted from the Company's asset sensitive position, coupled with the recent reductions in interest rates by the Federal Reserve.
As the balance sheet remains asset sensitive, a favorable earnings trend should result as rates rise.
Further, even though we continue to be fairly asset sensitive and have benefited from the past increases in the prime lending rate, we will attempt to reduce this sensitivity in the future.
Earnings continue to be under pressure mainly because of elevated capital levels and PBCT's asset sensitive balance sheet.
The Company is asset sensitive and has benefited from the eight interest rate increases by the Federal Reserve over the past year.
The Bank has positioned itself to be asset sensitive.
The continued increase in the net interest margin is attributable to the increases in the prime lending rate, growth in the loan portfolio, and the asset sensitive nature of the balance sheet.
This conscientious approach translates to an asset sensitive balance sheet.