5 Cheap Strong Buy Bank Stocks in 2023
(1:00) - Can You Find Good Investments In The Banking Industry?
(7:45) - Tracey’s Top Stock Picks: Creating A Strong Watchlist
(25:00) - Episode Roundup: CZWI, FINW, FRBA, NECB, OPBK
Podcast@Zacks.com
Welcome to Episode #350 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
With inflation coming down, many are thinking that the Federal Reserve may execute the soft landing for the economy. If that were to happen, some industries that have been beat up as the Fed has raised rates, could come back into favor.
The banks are cheap but the stocks have not been able to break out for years.
Is that about to change in 2024? Is the worst over for the bank stocks?
Screening for Top Ranked Bank Stocks
On Zacks, you can use the screening tool to find top stocks. You can screen for Zacks #1 Rank (Strong Buy) stocks, which should give you stocks with rising earnings estimates.
This screen used the finance sector to narrow it down even though that’s a broad sector which includes more than just banks, including insurance companies.
For the valuation component, Tracey screened for stocks with a P/B under 1.0, as P/B ratios are a better metric to use for banks than P/E or P/S ratios.
This simple screen returned just 24 stocks.
5 Cheap Strong Buy Bank Stocks
1. Citizens Community Bancorp, Inc. (CZWI)
Citizens Community Bancorp is a holding company of CCF Bank. It’s headquartered in Eau Claire, WI and has a market cap of just $117.9 million.
Shares of Citizens Community Bancorp are down 7.8% year-to-date but they’ve rallied 21.1% over the last month on the encouraging CPI data. It’s cheap, with a P/B of just 0.7. Bank analysts always say to buy bank stocks when the P/B ratio is 1.0 and sell when it’s 2.0.
Citizens Community Bancorp pays a dividend, yielding 2.6%.
Should Citizens Community Bancorp be on your bank short list?
2. FinWise Bancorp (FINW)
FinWise Bancorp is a holding company for FinWise Bank. It is headquartered in Murray, UT and has a market cap of $131.8 million.
Shares of FinWise Bancorp are up 13.9% year-to-date and have jumped 19.9% over the last month. It’s still cheap with a P/B ratio of 0.9. FinWise Bancorp does not pay a dividend.
Is there still time to buy into FinWise Bancorp?
3. First Bank (FRBA)
First Bank is a small bank headquartered in Hamilton, New Jersey, with business in Central and Northern New Jersey and Southeast Pennsylvania. It has a market cap of $303 million.
Shares of First Bank are down 11.5% year-to-date but have jumped 8.1% in the last month. Earnings are expected to rise 19.6% next year to $1.67 from $1.40. It’s still cheap, with a P/B ratio of just 0.84.
First Bank pays a dividend, currently yielding 1.9%.
Should First Bank be on your short list?
4. NorthEast Community Bancorp, Inc. (NECB)
NorthEast Community Bancorp operates NorthEast Community Bank. Founded in 1934, it’s headquartered in White Plains, NY. It has a market cap of $242 million.
Shares of NorthEast Community Bancorp are up 13.4% year-to-date and have also rallied in the last month, adding 13.7%. It pays a dividend, currently yielding 1.4%.
Should a New York bank like NorthEast Community Bancorp be on your bank short list?
5. OP Bancorp (OPBK)
OP Bancorp operates Open Bank and has a market cap of $127 million. It is headquartered in Los Angeles.
Shares of OP Bancorp are down 24.5% year-to-date and are also down 4.6% in the last month. It’s cheap, though, with a P/B ratio of 0.7.
OP Bancorp pays a dividend, currently yielding 5.6%.
Should you be looking west to OP Bancorp for a bank stock?
What Else Do You Need to Know About Cheap Bank Stocks?
Tune into this week’s podcast to find out.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
First Bank (FRBA) : Free Stock Analysis Report
Citizens Community Bancorp, Inc. (CZWI) : Free Stock Analysis Report
Northeast Community Bancorp Inc. (NECB) : Free Stock Analysis Report
OP Bancorp (OPBK) : Free Stock Analysis Report
FinWise Bancorp (FINW) : Free Stock Analysis Report
