Yahoo Finance 6 Best Bank Stocks To Buy In April
Bank stocks can yield high returns if you choose carefully. Most experts consider bank stocks as a “medium risk” investment, which means they can be part of a diversified portfolio, acting as something of a middle ground.
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Many of the biggest banks have staying power and security, making them a solid long-term investment. For instance, Bank of America is part of Warren Buffett’s portfolio, along with financial service company American Express, which Buffett’s investment firm Berkshire Hathaway has held since 1850.
In general, banks meet Buffett’s criteria for a good investment. It’s easy to understand their business model and offerings. They provide a service that will always be in demand. Plus, many bank stocks tend to be undervalued, meaning you can buy them at a discount.
However, there is one caveat: Bank stocks tend to be volatile, because they are so closely tied to the general economic landscape.
When you’re assessing bank stocks, evaluate how the company is run, the risk management processes they have in place to prevent failure or collapse — and even the technological innovations that will keep them at the front of the pack.
Based on expert analysis, here are six bank stocks you may want to consider adding to your portfolio in April 2024.
Bank of America
You’ll find Bank of America on nearly every list of best bank stocks for 2024, including Buffett’s. Had you invested in Bank of America in 2010, you’d have tripled your investment by now. Buffett first invested in Bank of America in 2007, when he paid more than $50 per share. But he purchased the bulk of his shares at a price of roughly $24 and continued buying when the price dropped to roughly $12 in 2010.
Bank of America also won the Best All-in-One National Bank accolade from GOBankingRates in 2024, a testament to the company’s stability, service, and offerings. You can grab this undervalued stock, as of April 4, for just over $37 per share.
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Ally Financial
Ally Financial is the only online-only bank on our list of best bank stocks. The other banks on this list have been around for decades, while Ally Financial has existed in its current form since 2009. But, the company has a long history dating back to 1919 as GMAC — the financing division of General Motors — offering financing to car dealers.
Ally is the leading online-only bank in the U.S. and is still a top lender for car loans. In 2023, the bank grew by 13%, reaching 3 million customers. Ally pays a dividend of 3.3% to shareholders, making it well worth the investment of just over $39 per share in the first week of April. Ally also garnered multiple awards from GOBankingRates this year, leading the categories of Best CD Accounts, Best Money Market Accounts and Best Online Banks.
Toronto-Dominion Bank (TD Bank)
TD Bank, one of Canada’s two largest banks, received an “uncertainty rating” of “low” and is listed as being undervalued, according to the experts at Morningstar. It is the largest credit card-issuer in Canada. The past year brought acquisitions that Morningstar said could make for messy earnings statements throughout 2024, but will ultimately pay off in growth and profitability. TD Bank offers a generous dividend of 3.8% and is valued at just under $60 in the first week of April.
Wells Fargo
One of America’s four biggest banks, Wells Fargo has proven its staying power and investment value. Like BofA, Wells Fargo garnered a Best Full-Service National Bank award from GOBankingRates in 2024, and was also recognized as offering the Best Premium Checking Account.
Several investment experts, including Morningstar, list Wells Fargo as one of the best bank stocks of the year. The stock offers dividends of 2.68%. It is currently trading at $57, slightly above its price target of $55.91. Even so, nine analysts at TipRanks.com rate it a “buy now,” while 10 say to hold. You may want to set aside some funds in your brokerage account and keep an eye on this stock to reach the target price.
US Bancorp
Tipranks.com also rates US Bancorp as a “Moderate Buy,” with 8 expert suggestions to buy and 11 to hold. Morningstar noted that the bank is one of the most profitable regional banks on their radar, with excellent operating efficiency and returns on equity.
The stock is currently trading at $43, well below its target price of $48. It offers a hefty dividend of 4.72%.
JPMorgan Chase
The largest bank in the U.S., with $3.9 trillion in assets as of the end of 2023, JPMorgan shares the spotlight with Bank of America and Wells Fargo as one of the best national banks for 2024, according to GOBankingRates. It is also one of the priciest investments on this list, with stock selling for just under $200 in April 2024. Nonetheless, CFRA Research, reported by U.S. News & World Report, gives the stock a buy rating with a price target of $190. Tipranks experts give Chase stock a “moderate buy” rating with 17 rating it a “buy” and 6 advising investors to hold their shares.
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This article originally appeared on GOBankingRates.com: 6 Best Bank Stocks To Buy In April
