10 of the Best Bank Stocks to Buy for 2025: Analyst Picks and Insights
As investors look ahead to 2025, the banking sector offers several promising opportunities despite ongoing economic uncertainties. Analysts from CFRA have identified ten bank stocks they consider undervalued with strong upside potential, reflecting optimism about economic growth, regulatory environments, and strategic company initiatives for the year.
Key Factors Influencing Bank Stocks in 2025
Entering 2025, many analysts anticipated that solid economic growth combined with a regulatory environment favorable to banks would drive impressive loan growth. Additionally, a rebound in mergers and acquisitions was expected to boost fee revenue for investment banks. However, market conditions have been shaken by uncertainty surrounding U.S. tariff policies and government layoffs, raising concerns about potential credit risks should the U.S. economy experience a recession. Thus, careful bank stock selection is crucial for investors this year.
Top 10 Bank Stocks with Upside Potential
According to CFRA data as of March 19, 2025, the following bank stocks show significant upside potential:
- JPMorgan Chase & Co. (JPM) – 29.6% upside
- Bank of America Corp. (BAC) – 25.5% upside
- Wells Fargo & Co. (WFC) – 29.1% upside
- HSBC Holdings PLC (HSBC) – 17.2% upside
- Royal Bank of Canada (RY) – 26.1% upside
- Citigroup Inc. (C) – 25.9% upside
- PNC Financial Services Group Inc. (PNC) – 52.4% upside
- NatWest Group PLC (NWG) – 5.6% upside
- M&T Bank Corp. (MTB) – 46.8% upside
- Fifth Third Bancorp (FITB) – 49.5% upside
Detailed Analyst Insights on Select Bank Stocks
JPMorgan Chase & Co. (JPM)
With nearly $4 trillion in assets under management, JPMorgan is one of the world’s largest financial services companies. Analyst Kenneth Leon points out that about 75% to 80% of JPMorgan’s revenue is generated in the U.S., making its 2025 performance closely tied to the domestic economy. The bank is gaining market share across various banking businesses, benefiting from increased business migration to larger banks. CFRA assigns a “buy” rating with a price target of $310, while the stock closed at $239.11 on March 19. Bank of America Corp. (BAC)
Boasting a large commercial and investment banking footprint as well as wealth management services, Bank of America is well positioned to benefit from pro-business policies anticipated to revive investment banking activity. Analysts expect the bank to exceed consensus estimates for net interest income (NII) and investment banking revenue, with NII playing a key role in organic revenue growth. CFRA rates BAC as a “buy” with a $53 price target; its stock stood at $42.21 on March 19. Wells Fargo & Co. (WFC)
One of the largest U.S. lenders, Wells Fargo has shown encouraging signs of restructuring success under CEO Charles Scharf. The bank has seen strong credit card business growth and may finally have its punitive asset cap restriction lifted in 2025. Analyst Alexander Yokum maintains a “buy” rating with a $94 price target; the stock closed at $72.76. HSBC Holdings PLC (HSBC)
As a globally significant bank with more than 40 million customers and substantial exposure to Asia, HSBC is favorably positioned to capitalize on Asia’s long-term banking growth. Declining interest rates are expected to be offset by increased fee income from asset management and private banking. Recent divestments of underperforming businesses have strengthened HSBC’s capital position. CFRA assigns a “buy” rating with a $69 price target; the stock closed at $58.85. Royal Bank of Canada (RY)
As Canada’s largest commercial bank and owner of City National in the U.S., Royal Bank of Canada boasts a track record of strong returns on equity and resilience during downturns. Synergies from mergers and strategic cost-cutting are expected to enhance profitability. A “buy” rating with a target price of $144 accompanies this stock, which closed at $114.22. Citigroup Inc. (C)
Citigroup is focusing on institutional banking growth and has effectively executed a turnaround strategy. The bank’s leadership in technology platforms and corporate treasury services, as well as plans to exit consumer banking in Mexico, are expected to streamline operations and enhance profitability. Analyst Kenneth Leon projects modest revenue growth and maintains a “buy” rating with a $90 price target; stock price stood at $71.44. PNC Financial Services Group Inc. (PNC)
PNC, a major U.S. bank providing asset management and corporate banking, is projected to benefit from rising net interest margins—from 2.75% at the end of 2024 to near 3% in 2025—along with reduced funding costs and accelerating loan growth. The strong buy rating and $265 price target reflect high confidence in its earnings outlook; the stock closed at $173.83. Additional Stocks to Watch
NatWest Group PLC (NWG) continues to improve profitability through digital transformation and cost-cutting, with a cost-to-income ratio that has fallen significantly. M&T Bank Corp. (MTB) and Fifth Third Bancorp (FITB) also exhibit substantial upside potential, reflecting strong fundamentals and strategic positioning.
Investor Takeaway
While some macroeconomic risks remain, including potential tariff impacts and federal layoffs, the banking sector shows potential for growth and value creation in 2025. Investors should consider these high-potential bank stocks as part of a diversified portfolio to tap into the sector’s opportunities amid evolving market conditions.
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