5 Most Undervalued Financial Stocks to Buy Now

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 (NYSE:FLG) 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.

While we acknowledge the potential of FLG 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 FLG and that has 100x upside potential, check out our report about this cheapest AI stock.

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