It’s fun to brag to your friends about how you’re making a killing after buying shares of the next big thing. Take Tesla for example. Most traders have heard of it and know the backstory of how it became one of the biggest stocks of the past several years.
The EV sector, of course led by Tesla Inc. (Nasdaq: TSLA), is hot… it’s interesting… it’s chic… it’s in fashion for investors.
But when you start talking about which bank stocks to buy now, peoples’ eyes glaze over. Banks are boring. Interest rates, which influence a bank’s profits, are boring.
But I’m here to tell you that you should care about banks, and particularly about what bank stocks to buy now…
Because there’s the potential to make a lot of money off bank stocks — and insurance company stocks, for that matter — in the coming months and years.
And one bank stock is poised to rise 50% over the next year…
A slew of banks are in the midst of reporting earnings this week, including Citigroup Inc. (NYSE: C), Wells Fargo & Co. (NYSE: WFC) and the biggest of them all, JPMorgan & Chase Co. (NYSE: JPM).
When it comes to what bank stocks to buy now, the earnings they report don’t much matter. What matters is the positive backdrop for interest rates — and the undervalued nature of these stocks.
First, interest rates. Looking at the 10-year Treasury note, the benchmark bond everyone watches is higher now than it was in March… at the height of the pandemic panic.
Right now, the bond is paying double the interest it was then, which is eight-tenths of 1%, or 0.008%. Yes, it’s still cheap to borrow. But as rates move higher, that means banks are making more money.
And interest rates are going to move much higher from here… clearly, because they’re in the 0% to 0.25% range as dictated by the Federal Reserve.
And with interest rates set to climb, that leaves most bank stocks hovering at or below their book value. Most are more profitable, dollar for dollar, than they were years ago.
And that brings us to my top bank stocks to buy now — and one I think will rise up to 50% in the next year. Check out my quick video and I’ll give you the full rundown.
After that, let me know in the comments below your top bank stock to buy now.