In this article, we will look at the 12 Undervalued Financial Stocks to Buy Now.
Financial stocks are getting more attention as investors look for cheaper parts of the market that still have earnings support. The sector has not moved in one straight line, with concerns around credit, rates, and economic growth still weighing on sentiment. Still, that uneven backdrop is also why banks, asset managers, insurers, and capital markets firms can become interesting when valuations look disconnected from growth prospects.
Fidelity says it is finding “attractive opportunities in undervalued financial stocks poised for growth,” especially names that may be “potentially undervalued relative to their growth potential.” The financials trade still needs stock selection. T. Rowe Price makes the banking case more directly, saying the sector presents “compelling opportunities for value investors,” with banks emerging as “a promising mid double-digit return industry” supported by “significant earnings growth.” J.P. Morgan Asset Management adds that “Value stocks have outperformed Growth year-to-date in 2026,” and points to “capital markets activity, benefiting financials.” In summary, the setup is less about buying every bank and more about finding financial companies where valuation, earnings recovery, and capital return are lining up.
Against this backdrop, undervalued financial stocks deserve a closer look. With that in mind, let’s take a look at the 12 Undervalued Financial Stocks to Buy Now.
Our Methodology
We used the Finviz screener to identify financial stocks trading below a forward P/E of 15x 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. Royal Bank of Canada (NYSE:RY)
On May 19, 2026, BofA analyst Ebrahim Poonawala raised the firm’s price target on Royal Bank of Canada (NYSE:RY) to C$273 from C$271 previously and maintained a Buy rating on the shares.
Scotiabank analyst Mike Rizvanovic also raised the firm’s price target on Royal Bank of Canada (NYSE:RY) to C$252 from C$247 previously and maintained an Outperform rating on the shares.
Meanwhile, on May 12, 2026, Raymond James has downgraded Royal Bank of Canada (NYSE:RY) to Market Perform from Outperform with a price target of C$265.50, up from C$248, ahead of Q2 earnings for the Big 6 Canadian banks. Raymond James said it continues to view RBC as “a scaled, diversified franchise with a lower-volatility earnings profile,” but noted that those same attributes may limit relative upside in a stronger trading revenue environment. The firm added that RBC’s greater exposure to rates and credit trading may benefit it less than its peers.
Royal Bank of Canada (NYSE:RY) operates as a diversified financial service company worldwide.
11. The Toronto-Dominion Bank (NYSE:TD)
On May 19, 2026, BofA raised the firm’s price target on The Toronto-Dominion Bank (NYSE:TD) to C$168 from C$150 previously and maintained a Buy rating on the shares.
On May 12, 2026, Raymond James analyst Stephen Boland upgraded The Toronto-Dominion Bank (NYSE:TD) to Outperform from Market Perform with a price target of C$152.50, up from C$141, ahead of Q2 earnings for the Big 6 Canadian banks. Boland said TD is “reasonably valued” and cited increased confidence in management’s ability to execute on its strategic priorities, supported by a recent meeting with TD Group President and CEO Raymond Chun.
Earlier in May, Scotiabank upgraded The Toronto-Dominion Bank (NYSE:TD) to Outperform from Sector Perform with a price target of C$150, up from C$142. Scotiabank said it is putting “increasing weight on the cost side of the P&L” given potential medium-term revenue headwinds for the group, particularly around net interest income. The firm also said its branch proximity analysis shows TD has the most branch count moderation potential among peers.
The Toronto-Dominion Bank (NYSE:TD) provides financial products and services in Canada, the United States, and internationally.
10. Chubb Limited (NYSE:CB)
On May 26, 2026, Piper Sandler raised the firm’s price target on Chubb Limited (NYSE:CB) to $340 from $328 and maintained a Neutral rating on the shares. Piper Sandler cited recent stock performance and the roll-forward of time. The firm said it slightly raised price targets for most insurance carriers and reduced targets for some insurance brokers, adding that after first-quarter results, it is probably wise to focus on carriers over brokers since underwriting performance was generally more helpful than expected.
On May 21, 2026, Chubb Limited (NYSE:CB) announced that shareholders approved a 5.2% increase in the company’s dividend to $4.08 per share annually from $3.88 per share at its 2026 Annual General Meeting in Zurich, Switzerland. The increase marks the company’s 33rd consecutive annual dividend increase.
Chubb Limited (NYSE:CB) also said that its Board of Directors authorized a new $7.5 billion share repurchase program, effective July 1, 2026, with no expiration date.
Chubb Limited (NYSE:CB) provides insurance and reinsurance products worldwide through six segments.
9. The Progressive Corporation (NYSE:PGR)
On May 21, 2026, BofA analyst Joshua Shanker lowered the firm’s price target on The Progressive Corporation (NYSE:PGR) to $320 from $325 and maintained a Buy rating on the shares. Shanker said April operating EPS missed expectations, largely due to higher catastrophe loss activity. BofA lowered its EPS estimates for 2026, 2027, and 2028 by 2.6%, 1.4%, and 1.3%, respectively, as the April miss flowed through its model.
On April 15, 2026, The Progressive Corporation (NYSE:PGR) reported Q1 EPS of $4.80, compared to the consensus estimate of $4.85. Net premiums written totaled $23.64B, up from $22.21B last year, while net premiums earned were $20.97B, compared to $19.41B last year. The company reported a combined ratio of 86.4%, compared to 86% last year.
The Progressive Corporation (NYSE:PGR) operates as an insurance company in the United States.
8. Marsh & McLennan Companies, Inc. (NYSE:MRSH)
On May 26, 2026, Piper Sandler analyst Paul Newsome lowered the firm’s price target on Marsh & McLennan Companies, Inc. (NYSE:MRSH) to $182 from $190 and maintained a Neutral rating on the shares. Newsome cited recent stock performance and the roll-forward of estimates.
On May 21, 2026, Morgan Stanley lowered the firm’s price target on Marsh & McLennan Companies, Inc. (NYSE:MRSH) to $180 from $190 and maintained an Equal Weight rating on the shares. Morgan Stanley noted that most property and casualty insurance companies saw slower premium growth but substantial underwriting profit in Q1, while expecting pricing and premiums to deteriorate further. Earlier in May, Citi analyst Matthew Heimermann upgraded Marsh McLennan to Buy from Neutral with an unchanged $200 price target, citing valuation and saying cyclical growth pressures should ease over the next few quarters.
Last month, Marsh & McLennan Companies, Inc. (NYSE:MRSH) reported Q1 adjusted EPS of $3.29, ahead of the consensus estimate of $3.22. Revenue totaled $7.6B, above the consensus estimate of $7.4B. President and CEO John Doyle said the company had a “solid start” to the year, citing 8% overall revenue growth, 4% underlying revenue growth, 8% adjusted operating income growth, and 8% adjusted EPS growth.
Marsh & McLennan Companies, Inc. (NYSE:MRSH) provides advisory services and insurance solutions in the areas of risk, strategy, and people worldwide.
7. Apollo Global Management, Inc. (NYSE:APO)
On May 26, 2026, Piper Sandler raised the firm’s price target on Apollo Global Management, Inc. (NYSE:APO) to $157 from $146 and maintained an Overweight rating on the shares. Piper Sandler cited Q1 results, where Apollo beat expectations and reaffirmed 2026 guidance for 10% spread-related earnings growth and 20% fee-related earnings growth. The firm said the higher multiple reflects peer multiple expansion and its view that Apollo is one of the best-positioned alternative asset managers in the space.
On May 19, 2026, Argus lowered the firm’s price target on Apollo Global Management, Inc. (NYSE:APO) to $160 from $168 and maintained a Buy rating on the shares. Argus said Q1 results were helped by higher fee-related earnings and realized performance fees, while noting that growth in both fee- and spread-related assets remains a near- and long-term earnings driver.
Earlier in May, Apollo announced that Apollo-managed funds acquired a majority interest in Noble Environmental, a vertically integrated waste management platform based in Pittsburgh, Pennsylvania.
Apollo Global Management, Inc. (NYSE:APO) is a private equity firm focused on credit, private equity, infrastructure, secondaries, and real estate markets.
6. Bank of America Corporation (NYSE:BAC)
On May 27, 2026, Bank of America Corporation (NYSE:BAC) Chairman and CEO Brian Moynihan said at the Bernstein Strategic Decisions Conference that the company feels good about its near-term outlook. Moynihan said Bank of America moved its full-year NII range from 5%-7% to 6%-8% and expects the current quarter to be “good and solid” on that front. Moynihan also said trading is tracking at roughly a 15% year-over-year increase, investment banking is in “pretty good shape,” and wealth management is growing in the low teens year-over-year.
Last month, Truist raised the firm’s price target on Bank of America Corporation (NYSE:BAC) to $61 from $57 and maintained a Buy rating on the shares after better-than-expected Q1 results. Truist incorporated 8% net interest income growth for the year, at the high end of the company’s new guidance range, along with better assumed growth in trading, investment banking, and wealth management fees.
Earlier in April, Bank of America Corporation (NYSE:BAC) reported Q1 EPS of $1.11, ahead of the consensus estimate of $1.02. Revenue totaled $30.3B, above the consensus estimate of $29.95B. The company also reported book value per share of $28.84, a CET1 capital ratio of 11.2%, and net charge-offs of 0.48%. Bank of America said EPS rose 25% year-over-year, net income reached $8.6 billion, and revenue growth of 7% included better-than-expected net interest income, up 9%, along with double-digit growth in sales and trading revenue, investment banking fees, and asset management fees.
Bank of America Corporation (NYSE:BAC) provides financial products and services to individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments worldwide.
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