We have recently put together a list of the 13 Top Performing Bank Stocks To Date in 2025. This article will explore how Flagstar Financial, Inc. (NYSE:FLG) compares to other bank stocks.
The banking sector appears to be thriving in 2025, fueled by stronger-than-anticipated economic conditions. Financial services companies are increasingly willing to take risks and invest in growth, particularly in artificial intelligence (AI). Additionally, central banks around the globe are continuing to lower interest rates, which is further benefiting the banking industry.
READ ALSO: 10 Unmatched Stocks for the Next 5 Years and 10 Top Low-Priced Technology Stocks to Buy Right Now.
In December 2024, Seana Smith, host of Yahoo Finance’s morning show, observed that it might be an opportune moment to invest in bank stocks. Heading into 2025, this sentiment was shared by many prominent strategists. Factors contributing to the positive outlook on bank stocks included a robust economy, anticipated deregulation under incoming President Donald Trump, appealing stock prices, and declining interest rates.
Brian Belski, Chief Investment Strategist and head of the Investment Strategy Group at BMO Capital Markets, highlighted in his 2025 forecast that financial stocks remain “significantly undervalued,” even with strong earnings growth expectations. Aadil Zaman from Wall Street Alliance Group pointed out that the Federal Reserve’s projected decrease in interest rates would likely boost investment banking activity.
Another reason for heightened optimism was that historically, financial stocks tend to perform well during Republican administrations due to expectations of reduced regulations, creating a more favorable landscape for banks.
To create our list of the 13 top-performing bank stocks in 2025 thus far, we utilized the Finviz stock screener to identify bank companies with the best year-to-date performance. We refined our selection by focusing on stocks with a market capitalization exceeding $2 billion. The resulting 13 best-performing bank stocks were ranked in ascending order by their year-to-date performance as of February 14, 2025.
Moreover, we included insights on hedge fund sentiment related to the top-performing stocks, utilizing data from Insider Monkey’s Q3 2024 database covering 900 elite hedge funds.
Why do we consider hedge fund actions important? The answer is straightforward: our research indicates that by mirroring the top stock choices of leading hedge funds, we can achieve market outperformance. Our quarterly newsletter’s approach involves selecting 14 small-cap and large-cap stocks each quarter and has delivered a 275% return since May 2014, exceeding its benchmark by 150 percentage points (see more details here).
