10 of the Best Bank Stocks to Buy for 2025: Analysts Highlight Undervalued Opportunities
As we move further into 2025, the banking sector is capturing significant investor interest, with many analysts predicting solid economic growth and a favorable regulatory climate that could stimulate impressive loan growth across major financial institutions. However, uncertainties such as tariff policies and federal workforce reductions have added volatility to the markets, making careful bank stock selection paramount this year.
CFRA, a respected independent provider of investment research insights, has identified 10 bank stocks with notable upside potential that investors should consider adding to their portfolios in 2025. —
Top 10 Bank Stocks with Strong Upside Potential
| Bank Name | Ticker | Upside Potential (as of March 19, 2025) |
|---|---|---|
| JPMorgan Chase & Co. | JPM | 29.6% |
| Bank of America Corp. | BAC | 25.5% |
| Wells Fargo & Co. | WFC | 29.1% |
| HSBC Holdings PLC | HSBC | 17.2% |
| Royal Bank of Canada | RY | 26.1% |
| Citigroup Inc. | C | 25.9% |
| PNC Financial Services Group Inc. | PNC | 52.4% |
| NatWest Group PLC | NWG | 5.6% |
| M&T Bank Corp. | MTB | 46.8% |
| Fifth Third Bancorp | FITB | 49.5% |
JPMorgan Chase & Co. (JPM)
JPMorgan Chase, one of the world’s largest financial services firms with almost $4 trillion in assets, is anticipated to closely track U.S. economic strength in 2025. Kenneth Leon, CFRA’s analyst, highlights the bank’s expanding market share in multiple banking segments and notes the growing trend of midsize companies shifting financial services to larger banks like JPMorgan. The firm maintains a “buy” rating with a price target of $310, compared to its closing price of $239.11 on March 19. —
Bank of America Corp. (BAC)
Bank of America stands as a leading commercial, investment, and wealth management bank in the U.S. Leon projects a strong rebound in investment banking fees supported by pro-business policies. The bank ranks third globally in investment banking fee revenue and is expected to exceed net interest income (NII) consensus estimates, contributing significantly to its organic revenue growth. CFRA assigns a “buy” rating and a price target of $53, above the $42.21 March 19 closing price.
Wells Fargo & Co. (WFC)
Wells Fargo, predominantly focused on the U.S. lending market, is poised to build on its 13.4% return on tangible common equity reported in 2024. Analyst Alexander Yokum expresses confidence in CEO Charles Scharf’s management and restructuring strategy, highlighting recent impressive growth in the bank’s credit card segment. Additionally, Wells Fargo’s punitive asset cap may be lifted this year—a potential catalyst for improved performance. CFRA gives Wells Fargo a “buy” rating with a $94 target; the stock closed at $72.76. —
HSBC Holdings PLC (HSBC)
With over 40 million customers worldwide, HSBC benefits from substantial exposure to Asian markets, which analysts view positively given Asia’s long-term banking growth prospects. Firdaus Ibrahim points to HSBC’s asset management and private banking fee income growth as vital revenue drivers in a declining interest rate environment. The bank’s divestiture of underperforming units has freed capital and improved profitability outlooks. HSBC currently sports a “buy” rating with a price target of $69, while trading at $58.85. —
Royal Bank of Canada (RY)
Canada’s largest commercial bank, Royal Bank of Canada also owns U.S.-based City National Bank. Yokum highlights the bank’s history of leading returns on equity, resilience in economic downturns, and expected benefits from merger synergies and improvement efforts at City National. Anticipated easing of deposit pricing pressures and cost-cutting initiatives bolster optimism. CFRA’s buy rating includes a $144 price target versus $114.22 closing price.
Citigroup Inc. (C)
Citigroup has successfully executed a turnaround strategy while positioning itself well in institutional banking, technology platforms, and corporate treasury services. The planned 2025 exit from consumer banking operations in Mexico aims to streamline its business and reduce costs. Leon anticipates steady revenue growth of approximately 4.1% this year. Its current market price is $71.44, with CFRA rating it a buy and setting a $90 price target.
PNC Financial Services Group Inc. (PNC)
One of the largest U.S. banks, PNC offers a blend of asset management and traditional banking services. Yokum forecasts an increase in net interest margin from 2.75% to nearly 3% during 2025, supported by falling funding costs, loan growth, and asset repricing. This outlook positions PNC to outperform earnings expectations. With a “strong buy” rating and a $265 price target, the stock trades at $173.83 as of March 19. —
NatWest Group PLC (NWG)
Leading the U.K.’s corporate and retail banking sectors, NatWest is focusing on digital transformation, disciplined growth, and efficient balance sheet management. Ibrahim notes significant operational improvements, including a reduction in the cost-to-income ratio from 74% in 2020 to 53.4% in 2024. The bank’s conservative balance sheet and low loan impairment rates also enhance its appeal.
Additional Bank Stocks to Watch
- M&T Bank Corp. (MTB): With an upside potential of 46.8%, M&T remains attractive for investors seeking strong fundamentals.
- Fifth Third Bancorp (FITB): Showing a 49.5% upside, Fifth Third is notable for its growth prospects as well.
Final Thoughts
Despite some headwinds such as geopolitical uncertainties and potential recession risks, the banking sector still offers compelling investment opportunities in 2025. Selecting stocks with strong growth prospects, resilient business models, and strategic initiatives underway—like those highlighted by CFRA—can provide investors with meaningful upside while navigating market volatility.
Investors intrigued by these recommendations should continue to monitor economic indicators and bank-specific developments closely to optimize their portfolio allocations.
This article reflects data and analysis as of March 20, 2025. Investors should conduct their own research or consult financial advisors before making investment decisions.