Banks and the financial services industry are currently doing well in Trump’s economy. The KBW Nasdaq Bank Index, which is designed to track the performance of the leading banks and thrift institutions, is up nearly 13% year-to-date as of July 18.
Another key measure, the Dow Jones US Financial Services Index, which is designed to measure the stock performance of US companies in the financial services sector, is also up nearly 12% so far this year as of July 18.
Wall Street is humming because of a surge in stock and bond trading. There has also been more activity as companies acquire other businesses and take out large loans. At the same time, consumers are continuing to spend money, borrow, and repay their loans, according to the latest reports from the biggest banks in the US.
In the second quarter of 2025, trading benefited from unpredictable market conditions because of Trump’s changing policy statements. Investment banking activity also surged. This involves mergers advice, IPOs, and debt and equity issuance.
Overall, it is proving to be a very profitable time for financial companies. The six largest banks in the US made around $39 billion in profit in the second quarter, exceeding analysts’ expectations and collectively surging over 20% from core earnings a year ago.
With this background in mind, let’s take a look at the 10 best financial stocks on Wall Street’s radar.
An iconic financial building in the background, with silhouettes of busy bankers walking past in the foreground.
Our Methodology
To compile our list of the 10 best financial stocks on Wall Street’s radar, we sifted through financial media reports and various online resources to look for financial stocks that were covered by Wall Street analysts on July 18, 2025. Next, we focused on the top 10 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q1 2025 database of 1,000 elite hedge funds. Finally, the 10 best financial stocks on Wall Street’s radar were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q1 2025.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Financial Stocks on Wall Street’s Radar
10. F.N.B. Corporation (NYSE:FNB)
Number of Hedge Fund Holders: 32
F.N.B. Corporation (NYSE:FNB) is one of the best financial stocks on Wall Street’s radar. On July 18, Raymond James increased its price target on F.N.B. Corporation (NYSE:FNB) from $15 to $18 while keeping an “Outperform” rating.
This decision came after the company reported its second-quarter results. F.N.B. Corporation (NYSE:FNB) showed strong core performance, including lower costs for funding and asset repricing that helped improve both its net interest margin and net interest income.
Raymond James pointed out that F.N.B. Corporation (NYSE:FNB) showed improvements in its capital levels and asset quality during the second quarter. Additionally, fee revenues exceeded expectations.
F.N.B. Corporation (NYSE:FNB) increased its guidance for net interest income in 2025. However, Raymond James’ analysis suggests that this outlook might still be conservative if commercial loan growth pipelines accelerate as expected. The firm sees the risk-reward profile for F.N.B. Corporation (NYSE:FNB) as attractive at current levels.
F.N.B. Corporation (NYSE:FNB) is a diversified financial services company that offers a full range of commercial banking, consumer banking, and wealth management solutions. The company operates through its subsidiary network, which is led by its largest subsidiary, First National Bank of Pennsylvania.
9. Fifth Third Bancorp (NASDAQ:FITB)
Number of Hedge Fund Holders: 41
Fifth Third Bancorp (NASDAQ:FITB) is one of the best financial stocks on Wall Street’s radar. On July 18, DA Davidson maintained a “Buy” rating on Fifth Third Bancorp (NASDAQ:FITB) and kept its price target of $47.
The investment firm still has a positive view of the banking company despite noting that Fifth Third Bancorp (NASDAQ:FITB) has indicated loan growth will likely moderate in the second half of 2025. The company has also tempered its fee income growth guidance for the full year. This prompted DA Davidson to slightly reduce its earnings per share forecasts for Fifth Third Bancorp (NASDAQ:FITB).
According to DA Davidson, the company’s management is still aiming to deliver 150 to 200 basis points of positive operating leverage, even if the capital markets do not recover. The firm highlighted strong first-half 2025 performance and noted that Fifth Third Bancorp (NASDAQ:FITB) has several expense reduction options available.
Additionally, DA Davidson’s analysis suggests that the company is on track to achieve record net interest income even without interest rate cuts from the Federal Reserve or any further loan growth.
Fifth Third Bancorp (NASDAQ:FITB) is a bank holding company for Fifth Third Bank, which offers a wide range of financial services to individuals, families, and businesses.
