In this article, we will look at the 12 Most Undervalued Financial Stocks to Buy Now.
Financial stocks have been trading at discounted valuations despite a backdrop of resilient credit conditions and improving profitability. Elevated interest rates have boosted net interest margins for many lenders, while capital markets activity has gradually recovered. Yet many banks, insurers, and diversified financial firms continue to trade at valuation multiples well below the broader market, leaving investors searching for opportunities where fundamentals and pricing appear disconnected.
McKinsey & Company’s Global Banking Annual Review 2025 suggests the industry is entering a period where operational precision and efficiency will matter more than sheer balance-sheet scale. In its recent analysis of the sector, the firm noted that “Precision, not heft, is the great equalizer,” arguing that institutions able to deploy capital and technology more effectively could generate stronger returns even in a more competitive environment.
At the same time, institutional investors see attractive entry points emerging within financial equities. In its 2026 Financials Outlook, Angel Oak Capital Advisors notes that many financial companies are trading at valuations that remain below long-term historical averages, even as performance has stayed relatively stable.
Valuation discipline has also become an increasingly important factor for long-term investors. In its 2026 Long-Term Capital Market Assumptions Report, J.P. Morgan Asset Management emphasizes that “the starting point for valuations has an impact on long-term returns,” underscoring how buying fundamentally sound companies at discounted prices can materially influence long-term performance.
Taken together, these perspectives suggest that a sector long overshadowed by technology-led market gains now offers value. With strong capital positions, improving earnings dynamics, and valuations that remain below historical norms in many cases, financial stocks present compelling opportunities for investors. With this in mind, we take a closer look at the 12 Most Undervalued Financial Stocks to Buy Now.
Our Methodology
We used the Finviz screener to identify Financial stocks that are trading below a forward P/E of 15, and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Why are we interested in the stocks that hedge funds pile into? 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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
12. AllianceBernstein Holding L.P. (NYSE:AB)
On March 11, 2026, AllianceBernstein Holding L.P. (NYSE:AB) said preliminary assets under management rose to $880 billion in February from $875 billion at the end of January. The 0.6% increase in month-end AUM was driven by market appreciation, partially offset by modest net outflows. By channel, inflows in Private Wealth and Institutional were offset by outflows in Retail during the month.
On March 6, 2026, Evercore ISI lowered its price target on AllianceBernstein to $41 from $43 while maintaining an Outperform rating on the shares. The firm adjusted price targets across the group after taking an early look at February and Q1 traditional asset manager flows.
Last month, AllianceBernstein reported Q4 adjusted EPS of 96c, beating the 92c consensus estimate. Revenue was $1.22 billion compared with the consensus of $956.06 million. CEO Seth Bernstein said 2025 marked a year of “disciplined execution and strategic progress” for the firm as it broadened its platform and deepened client relationships. He noted that the company ended the year with a record $867 billion in assets under management and generated organic growth in areas such as ultra-high-net-worth, insurance, separately managed accounts, active ETFs, and private markets. Bernstein added that private markets AUM reached $82 billion, up 18% year over year, while the firm generated more than $140 billion in sales during the year despite net outflows in active equities.
AllianceBernstein Holding L.P. is a publicly owned investment manager that provides services to investment companies, pension and profit-sharing plans, banks and thrift institutions, trusts, estates, government agencies, charitable organizations, individuals, corporations, and other business entities.
11. Bank of America Corporation (NYSE:BAC)
On March 10, 2026, Bank of America Corporation (NYSE:BAC) co-president Dean Athanasia said at a conference hosted by RBC that first-quarter net interest income is tracking at least 7% higher year over year. Athanasia also said investment banking revenue is expected to rise about 10%, while the Markets segment is up in the low-double-digit range.
On February 19, 2026, Bloomberg reported that Bank of America plans to deploy about $25 billion into private-credit transactions, citing people familiar with the matter. The bank intends to commit its own capital to private-credit investments as it expands its direct-lending platform, with transactions expected to be originated through the firm’s capital markets unit within its investment banking division.
On February 18, 2026, Bank of America announced plans to launch BofA Rewards, a no-fee loyalty program. The bank said millions of clients will be able to enroll beginning May 27 to access benefits across eligible credit cards, cash back deals, banking services, and curated experiences, with members potentially receiving between $150 and $4,000 in annual value depending on membership tier and engagement.
Bank of America Corporation, through its subsidiaries, provides financial products and services to individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments worldwide.
10. Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA)
On March 9, 2026, Banco Bilbao Vizcaya Argentaria, S.A. (NYSE:BBVA) saw JPMorgan lower its price target on the shares to EUR 23.30 from EUR 23.50 previously while maintaining an Overweight rating.
Meanwhile, in February, Deutsche Bank raised its price target on Banco Bilbao Vizcaya Argentaria, S.A. to EUR 21.24 from EUR 19.75 previously and kept a Buy rating on the shares. RBC Capital has also increased its price target on Banco Bilbao Vizcaya Argentaria, S.A. to EUR 20.25 from EUR 19.75 previously, while maintaining a Sector Perform rating on the shares.
Separately, Morgan Stanley has lowered its price target on Banco Bilbao Vizcaya Argentaria, S.A. to EUR 20 from EUR 20.70 previously and kept an Equal Weight rating on the shares.
Banco Bilbao Vizcaya Argentaria, S.A., together with its subsidiaries, provides financial services across Spain, Mexico, Turkey, South America, Europe, the United States, and Asia. BBVA offers traditional retail, wholesale, investment, and transaction banking.
9. Chubb Limited (NYSE:CB)
On March 11, 2026, Chubb Limited (NYSE:CB) was reported by CNBC to serve as the lead underwriter for a government-led insurance program aimed at supporting ships transiting the Strait of Hormuz. The initiative, developed with the U.S. Development Finance Corporation, is part of a $20 billion plan designed to help oil tankers and other commercial vessels resume operations along the high-risk route.
On February 26, 2026, Morgan Stanley analyst Bob Huang raised the firm’s price target on Chubb to $330 from $310 while maintaining an Equal Weight rating on the shares. The firm updated targets across the property and casualty insurance group following Q4 results, noting that insurers with more differentiated underwriting performance are likely to see stronger share price performance. Morgan Stanley added that while pricing remains weak and AI-related headwinds persist, companies with durable underwriting margins could outperform.
Earlier in February, Chubb reported Q4 core EPS of $7.52, beating the $6.78 consensus estimate. Revenue was reported in line with expectations, around $11.14 billion. Chairman and CEO Evan Greenberg said the company delivered “a great quarter and a great year,” supported by strong contributions across its global businesses. He noted that double-digit growth in underwriting and life income, along with record investment income, drove operating income growth of more than 20% during the quarter while total company net premiums increased nearly 9%.
Chubb Limited provides insurance and reinsurance products worldwide and operates across segments, including North America Commercial Property and Casualty Insurance, North America Personal P&C Insurance, North America Agricultural Insurance, Overseas General Insurance, Global Reinsurance, and Life Insurance.
8. Citizens Financial Group, Inc. (NYSE:CFG)
On March 9, 2026, Citizens Financial Group, Inc. (NYSE:CFG) was upgraded by Baird to Outperform from Neutral with an unchanged price target of $65. The firm said recent weakness in bank stocks has created more attractive risk-reward opportunities, adding that many regional banks currently offer a margin of safety given solid capital positions and stable credit trends.
On March 2, 2026, Morgan Stanley raised its price target on Citizens Financial Group, Inc. to $80 from $73 while maintaining an Overweight rating on the shares. The firm increased price targets across the mid-cap banks group by a median of 8%, citing tailwinds from loan growth, net interest margin expansion, and capital return despite noting that recent outperformance has raised the bar for the group.
Earlier, Citizens Financial reported Q4 EPS of $1.13, beating the $1.11 consensus estimate. Chairman and CEO Bruce Van Saun said the company delivered “good Q4 and full-year results” driven by the execution of key growth initiatives and continued improvement in net interest margin. He added that fee growth was supported by Capital Markets and Wealth, credit costs improved, and the company returned about 80% of capital to shareholders during the year.
Citizens Financial Group, Inc. operates as a bank holding company that provides retail and commercial banking products and services to individuals, small businesses, middle-market companies, large corporations, and institutions in the United States through its Consumer Banking and Commercial Banking segments.
7. The Goldman Sachs Group, Inc. (NYSE:GS)
On March 10, 2026, The Goldman Sachs Group, Inc. (NYSE:GS) saw JPMorgan raise its price target on the shares to $826 from $815 previously while maintaining a Neutral rating.
On March 5, 2026, Goldman Sachs Alternatives announced a strategic investment in cybersecurity compliance firm Schellman. The investment was made through the firm’s private equity platform and is intended to support Schellman’s next phase of growth, including expanding capabilities, scaling its team, and increasing its presence in areas such as AI governance, federal compliance, and digital trust. Lightyear Capital, which has been the majority investor since 2021, will remain a minority investor following the transaction, which is expected to close in the second quarter of 2026, subject to regulatory approvals.
Last month, The Wall Street Journal reported that Goldman Sachs plans to remove race, gender identity, sexual orientation, and other diversity-related factors from its board diversity criteria. The change follows a proposal submitted by the National Legal and Policy Center requesting the removal of DEI criteria, according to people familiar with the matter.
The Goldman Sachs Group, Inc. provides financial services to corporations, financial institutions, governments, and individuals across the Americas, Europe, the Middle East, Africa, and Asia.
6. Invesco Ltd. (NYSE:IVZ)
On March 10, 2026, Invesco Ltd. (NYSE:IVZ) reported preliminary month-end assets under management of $2.26 trillion, up 1.2% from the previous month. The firm recorded $4.7 billion in net long-term inflows during February, while money market strategies saw $13.5 billion in net inflows. Favorable market returns increased AUM by $9 billion, partly offset by a $1.1 billion negative impact from foreign exchange.
On March 6, 2026, Evercore ISI analyst Glenn Schorr lowered the firm’s price target on Invesco Ltd. to $29 from $31 while maintaining an In Line rating on the shares. The firm adjusted price targets across the asset manager group after taking an early look at February and Q1 traditional asset manager flows.
Earlier, Invesco Ltd. reported Q4 adjusted EPS of 62c, beating the 58c consensus estimate. Revenue came in at $1.26 billion compared with the consensus of $1.25 billion, and the company ended the quarter with $2.2 trillion in assets under management.
Invesco Ltd. is a publicly owned investment manager that provides services to retail and institutional clients, high-net-worth individuals, public entities, corporations, unions, non-profit organizations, endowments, foundations, pension funds, financial institutions, and sovereign wealth funds.
5. Lazard, Inc. (NYSE:LAZ)
On March 12, 2026, Lazard, Inc. (NYSE:LAZ) saw UBS lower its price target on the shares to $48 from $59 while maintaining a Neutral rating.
Also on March 12, 2026, Goldman Sachs reduced its price target on Lazard to $46 from $53 and kept a Sell rating. The firm noted that investment banking volumes are up about 4% year over year through March 9, though growth has slowed and could turn negative if geopolitical uncertainty persists. Goldman Sachs added that bank stocks are down roughly 15% year to date and have underperformed the S&P 500 due to multiple compression, though longer-term prospects for M&A remain constructive as the cycle is still viewed as being in the middle stages relative to the 2023 trough.
On March 10, 2026, Lazard reported preliminary assets under management of about $277.7 billion as of February 28. The month’s AUM included $8.9 billion in market appreciation and $4.2 billion in net inflows, partially offset by $0.8 billion in foreign exchange depreciation and a $1.5 billion decrease related to the sale of its stake in the Edgewater Funds management vehicles.
Lazard, Inc. operates as a financial advisory and asset management firm across the Americas, Europe, the Middle East, Africa, and the Asia Pacific through its Financial Advisory and Asset Management segments.
4. Main Street Capital Corporation (NYSE:MAIN)
On March 10, 2026, Main Street Capital Corporation (NYSE:MAIN) announced that it completed a new portfolio investment totaling $61.5 million to support the minority recapitalization of a specialized structural steel fabricator. The investment included a combination of first-lien senior secured term debt and a direct minority equity investment. Main Street also provided a revolving credit facility to support the company’s future growth initiatives and working capital needs.
On February 26, 2026, Main Street Capital Corporation reported fourth-quarter distributable net investment income of $1.09 per share, beating the $1.01 consensus estimate. Net asset value was $33.33 per share as of December 31, 2025, up $0.55 per share, or 1.7%, from $32.78 as of September 30, 2025. Chief Executive Officer Dwayne Hyzak said that the company delivered “continued strong performance in the fourth quarter,” closing another strong year for the firm. Dwayne Hyzak added that the results included record levels across key metrics, with return on equity reaching 17.7% for the quarter and 17.1% for the full year, supported by strong investment activity and growth in net asset value.
Main Street Capital Corporation is a business development company and small business investment company that focuses on direct and indirect investments, including providing private equity capital to lower middle market companies.
3. Moelis & Company (NYSE:MC)
On March 12, 2026, Moelis & Company saw UBS lower its price target on the shares to $59 from $74 previously while maintaining a Neutral rating.
Last month, Moelis & Company reported Q4 EPS of $1.13, beating the 83c consensus estimate. Revenue came in at $487.9 million compared with the consensus of $435.1 million. CEO Navid Mahmoodzadegan said the firm delivered “strong momentum” in 2025, supported by what Mahmoodzadegan described as the strongest coverage platform in the company’s history, adding that Moelis enters 2026 positioned to drive further growth and long-term value.
Moelis & Company operates as an investment banking advisory firm providing services including mergers and acquisitions, recapitalizations, restructurings, capital markets transactions, strategic advisory, capital structure advisory, and private capital advisory across North and South America, Europe, the Middle East, Asia, and Australia.
2. State Street Corporation (NYSE:STT)
On March 11, 2026, State Street Corporation (NYSE:STT) said at the RBC Capital Markets Global Financial Institutions Conference that first-quarter results are expected to come in stronger than what the company had anticipated earlier in the year. An executive has noted that a weaker dollar is relatively neutral to overall operating leverage but is expected to have “a couple of percentage points of impact on both revenue and expense on a year-over-year basis.”
The executive added that while the operating environment remains dynamic and some of the positive trends supporting results this quarter may not persist beyond Q1, the company remains confident in its ability to deliver another year of positive total operating leverage and pre-tax margin expansion across a range of scenarios.
Last month, in February, JPMorgan analyst Vivek Juneja raised the firm’s price target on State Street Corporation to $137.50 from $135 previously while maintaining a Neutral rating on the shares.
State Street Corporation provides financial products and services to institutional investors, including custody, accounting, and fund administration services for traditional and alternative assets, as well as trading, securities finance, and investment analytics solutions.
1. Flagstar Bank, National Association (NYSE:FLG)
On March 13, 2026, Flagstar Bank, National Association (NYSE:FLG) was upgraded by Keefe Bruyette analyst Christopher McGratty to Outperform from Market Perform with a price target of $16, raised from $14. The firm cited the stock’s recent underperformance, improving fundamentals, and what it described as an emerging share buyback catalyst as reasons for the upgrade.
On March 2, 2026, Morgan Stanley raised its price target on Flagstar Financial to $16 from $14 while maintaining an Equal Weight rating on the shares. The firm increased price targets by a median of 8% across the mid-cap banks group and pointed to tailwinds from loan growth, net interest margin expansion, and capital return, though it noted that recent outperformance raises the bar for further gains.
Earlier, Flagstar Financial reported Q4 adjusted EPS of 6c, beating the 2c consensus estimate. Revenue came in at $557 million versus consensus of $531.47 million, while tangible book value per share was $15.82. CEO Joseph Otting said the company was “extremely pleased” with its fourth-quarter performance as the bank returned to profitability after two challenging years, reporting net income attributable to common stockholders of $21 million, or $0.05 per diluted share, and $30 million on an adjusted basis.
Flagstar Bank, National Association provides banking products and services in the United States, including interest-bearing checking and money market accounts, savings accounts, non-interest-bearing accounts, and certificates of deposit.
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