5 Best European Bank Stocks to Buy According to Hedge Funds

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​1. UBS Group AG (NYSE:UBS)

Number of Hedge Fund Holders: 39

UBS Group AG (NYSE:UBS) is one of the Best European Bank Stocks to Buy According to Hedge Funds. On May 13, Deutsche Bank analyst Benjamin Goy raised its price target on UBS Group AG (NYSE:UBS) from CHF 39 to CHF 40 and maintained a Buy rating on the shares.

​Deutsche Bank’s rating comes after UBS announced fiscal Q1 2026 earnings on April 29. During the quarter, the bank posted $3.0 billion in net profits, representing 80% year-over-year growth and beating the average estimate of $2.3 billion. Management noted the standout drivers to be record trading revenue in its investment banking division, where income surged 27%, driven by market turbulence linked to the Iran war. Moreover, global wealth management added $37 billion in net new assets, with a notable $5.3 billion inflow from the Americas reversing prior-quarter outflows in that key growth market.

​A recent report by Reuters highlighted that despite strong results, the attention has shifted towards regulatory pressures from Switzerland’s newly proposed banking bill, which could require UBS to raise an additional $20 billion in core capital.

​The report noted that while UBS Group AG (NYSE:UBS) has reaffirmed its commitment to at least $3 billion in share buybacks for 2026, CEO Sergio Ermotti cautioned that second-half buyback ambitions hinge on greater clarity from parliament on capital rules.

​UBS Group AG (NYSE:UBS) is a global financial institution that provides wealth management, personal and corporate banking, asset management, and investment banking services to private, institutional, and corporate clients worldwide.

While we acknowledge the potential of UBS to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than UBS and that has 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT: 10 Best Stocks to Buy While the Market Is Down and 14 Stocks That Will Double in the Next 5 Years. 

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