7 Bank Stocks That Are the LEAST Likely to Fail (2024)

Just when you thought the banking sector fallout was behind us, rumblings in Europe confirmed that bank stocks once again will likely dominate business news outlets for weeks to come. While the mainstream media can sometimes lead to ambulance-chasing histrionics, this time around, the anxieties appear justified. Still, I thought it would be a nice contrarian exercise to consider the financial institutions least likely to fail.

Now, some of my colleagues have asked ChatGPT to deliver an artificial intelligence-driven answer. However, for our purposes today, I consulted Gurufocus’ stock screener for the probability of financial distress. The below bank stocks – per the investment resource – represent an elite few that likely will not collapse.

JPM

JPMorgan Chase

$129.09

BAC

Bank of America

$28.48

WFC

Wells Fargo

$37.57

HSBC

HSBC Holdings

$33.60

RY

Royal Bank of Canada

$93.64

HDB

HDFC Bank

$64.60

TD

Toronto-Dominion Bank

$57.82

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

JPMorgan Chase (JPM)

7 Bank Stocks That Are the LEAST Likely to Fail (1)

Source: Daryl L / Shutterstock.com

The inclusion of JPMorgan Chase (NYSE:JPM) as one of the bank stocks least likely to fail shouldn’t surprise anyone. That’s not to say it didn’t suffer from the sector fallout because it did. Since the Jan. opener, JPM slipped almost 8%. Still, 8% isn’t 80%. As well, the company features a robust $379 billion market capitalization. More than likely, it’s going to stick around for some time.

According to Gurufocus, JPMorgan’s probability of distress pings at 0.06%. Obviously, that’s not anything but it’s as close to nothing as you’re going to get. It has other stats going for it as well. For example, the financial institution’s three-year free cash flow (FCF) growth rate stands at 205.3%, outpacing nearly 98% of the competition. Also, its return on equity (ROE) comes in at 13%, indicating a high-quality business.Finally, Wall Street analysts peg JPM as a consensus moderate buy. Notably, their average price target stands at $154.93, implying 24% upside potential.

Bank of America (BAC)

7 Bank Stocks That Are the LEAST Likely to Fail (2)

Source: Shutterstock

A multinational investment bank and financial services firm, Bank of America (NYSE:BAC) is one of the big four financial firms. For full disclosure, BAC did suffer more than JPMorgan Chase above. Since the Jan. opener, BAC gave up 19% of equity value. In the past 365 days, it slipped 38%. However, it’s still one of the biggest bank stocks with a market cap of over $228 billion.

According to Gurufocus, Bank of America’s probability of distress comes out to 0.38%. Percentage-wise, it’s much higher than JPM. Still, we’re talking about an overall minuscule scale. Further, BofA enjoys decent, slightly above-average performance metrics. For instance, its three-year revenue growth rate of 6.4% ranks better than 52.2% of the industry.Lastly, covering analysts peg BAC as a consensus moderate buy. Notably, the three most recent assessments represented reiterations of buy targets. Overall, the experts anticipate BAC hitting $38.80, implying 43% upside potential.

Wells Fargo (WFC)

7 Bank Stocks That Are the LEAST Likely to Fail (3)

Source: PopTika/ShutterStock.com

A member of the big four bank stocks, Wells Fargo (NYSE:WFC) in recent years courted some ugly controversies. Nevertheless, it finds itself as one of the least likely financial institutions to fail. Interestingly, since the Jan. opener, WFC gave up more than 13% of equity value. That makes WFC slip in somewhere between JPMorgan Chase and Bank of America.

Per Gurufocus, the investment resource calculates Wells’ probability of distress at 0.32%, a bit below BAC’s probability. Again, we’re talking about extremely low chances. Regarding other financial metrics, Wells benefits from consistent profitability. Over the past decade, it posted 10 years of profitability.

As well, WFC trades at 1.91 times trailing sales. As a discount to revenue, Wells ranks better than 61.48% of competing bank stocks.Turning to Wall Street, analysts peg WFC as a consensus moderate buy. To be fair, the two most recent assessments came out as holds. However, overall, the average price target is $52, implying almost 44% upside potential.

HSBC Holdings (HSBC)

7 Bank Stocks That Are the LEAST Likely to Fail (4)

Source: Shutterstock

A British multinational universal bank and financial services firm, HSBC Holdings (NYSE:HSBC) differs from the U.S. major bank stocks in that it’s up for the year. Specifically, since the Jan. opener, HSBC gained almost 5% of its equity value. And in the trailing year, it’s only down 3.3%.

From Gurufocus’ stock screener, it calculates the enterprise’s probability of distress at 0.05%. To be sure, that’s lower than even JPMorgan Chase’s forecast. Looking at other financial metrics, HSBC benefits from consistent profitability. In the past decade, the company posted 10 years of net income.Moreover, the market prices HSBC at a forward multiple of 6.05. As a discount to projected earnings, the company ranks better than 69.74% of rival bank stocks.

Finally, investment firm CFRA pegs HSBC as a buy. Further, it projects that shares will hit $43, implying 30% upside potential.

Royal Bank of Canada (RY)

7 Bank Stocks That Are the LEAST Likely to Fail (5)

Source: JHVEPhoto

Based in its namesake country, Royal Bank of Canada (NYSE:RY) is the largest bank in Canada by market cap. Presently, it features a market value of slightly over $129 billion. Since the Jan. opener, RY declined by almost 2%, which of course is a shame. Up until early Feb., RY was off to an auspicious start. In the past 365 days, it’s down nearly 19%.

According to Gurufocus, the investment resource calculated Royal Bank’s probability of distress at 0.05%. That’s not terribly surprising given its bottom-line focus. In the past decade, the company delivered 10 years of profitability. Also, its ROE stands at 14.18%, reflecting its high quality. Operationally, Royal Bank’s three-year book growth rate pings at 10.1%, above 72.42% of the industry.

Looking to the Street, analysts peg RY as a consensus moderate buy. The two most recent assessments feature a split vote: one hold, one buy. Overall, the experts’ average price target stands at $102.09, indicating nearly 11% upside potential.

HDFC Bank (HDB)

7 Bank Stocks That Are the LEAST Likely to Fail (6)

Source: shutterstock.com/CC7

Headquartered in Mumbai, India, HDFC Bank (NYSE:HDB) is its country’s largest private sector bank by assets. Also, as of April 2021, HDFC ranked as the tenth largest bank by market cap. Since the start of the year, HDB has been fairly choppy, shedding more than 7% of equity value. However, in the past 365 days, it’s up more than 5%.

Per Gurufocus, it calculated the probability of distress for HDFC Bank at 0.03%. Moreover, accompanying financial metrics bolster this extremely low probability. For instance, the company’s equity-to-asset ratio comes out to 0.12 times, above the industry median of 0.09 times. Operationally, HDFC’s three-year revenue growth rate pings at 14.1%, above 81.41% of other bank stocks.

Conspicuously, the enterprise posted a net margin of 37.86%, a robust figure. As well, its ROE is 16.53%. Currently, no analysts cover HDB stock, though this could change based on its comparative performance.

Toronto-Dominion Bank (TD)

7 Bank Stocks That Are the LEAST Likely to Fail (7)

Source: Syda Productions / Shutterstock.com

Finally, rounding out this list of bank stocks that are least likely to fail is Toronto-Dominion Bank (NYSE:TD). Headquartered in Toronto, Ontario, TD is one of the largest financial firms in Canada by total assets and also by market cap. Since the January opener, TD stock gave up nearly 12% of its equity value as fears rippled across the underlying sector.

Nevertheless, Gurufocus calculates that the probability of distress for Toronto-Dominion Bank is 0.15%. To be blunt, TD doesn’t have the greatest strength in the balance sheet right now. However, on the profitability front, the company features a net margin of 32.09%. This stat ranks above 66.25% of the underlying banking sector.In addition, TD’s price-to-projected-free-cash-flow (FCF) ratio sits at 0.2 times. In contrast, the sector median is 0.45 times.

Lastly, covering analysts peg TD as a consensus moderate buy. Their average price target stands at $74.21, implying over 31% upside potential.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article.The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.

More From InvestorPlace

The post 7 Bank Stocks That Are the LEAST Likely to Fail appeared first on InvestorPlace.

7 Bank Stocks That Are the LEAST Likely to Fail (2024)

FAQs

7 Bank Stocks That Are the LEAST Likely to Fail? ›

Companies Considered Too Big to Fail

The Bank of New York Mellon Corp. Citigroup Inc. The Goldman Sachs Group Inc. JPMorgan Chase & Co.

Which bank is least likely to fail? ›

Summary: Safest Banks In The U.S. Of April 2024
BankForbes Advisor RatingLearn More
Chase Bank5.0Learn More Read Our Full Review
Bank of America4.2
Wells Fargo Bank4.0Learn More Read Our Full Review
Citi®4.0
1 more row
Jan 29, 2024

Which banks will never fail? ›

Companies Considered Too Big to Fail

The Bank of New York Mellon Corp. Citigroup Inc. The Goldman Sachs Group Inc. JPMorgan Chase & Co.

Which bank stock is best to buy now? ›

Best Banking Stocks in India
  • HDFC Bank. HDFC Bank is one of India's largest private sector banks, and it is known for its extensive branch network. ...
  • Kotak Mahindra Bank Ltd. ...
  • ICICI Bank. ...
  • Bank of Baroda Ltd. ...
  • SBI (State Bank of India) ...
  • Indian Bank. ...
  • Axis Bank Ltd. ...
  • Canara Bank Ltd.
Apr 10, 2024

Which bank stock is undervalued? ›

Those trying to find undervalued banks should have a look at Bandhan Bank (NS: BANH ) Limited. It is a private-sector lender with a market capitalization of INR 31,420 crore.

Which banks to avoid? ›

  • These Banks Are Monopolizing the Industry. The Financial Times reported in November 2023, “Of the nation's almost 4,400 banks, the big four made 45 percent of the industry's overall profits in the third quarter. ...
  • Bank of America. ...
  • Citi Bank. ...
  • Chase Bank. ...
  • Wells Fargo. ...
  • Take Action and Tell These Banks to Do Better.
Mar 7, 2024

Which 4 banks are in trouble? ›

About the FDIC:
Bank NameBankCityCityClosing DateClosing
Heartland Tri-State BankElkhartJuly 28, 2023
First Republic BankSan FranciscoMay 1, 2023
Signature BankNew YorkMarch 12, 2023
Silicon Valley BankSanta ClaraMarch 10, 2023
55 more rows

What is the safest big bank? ›

10 Safest Banks in the U.S.
BankAssetsFDIC Insured?
JP Morgan Chase$3.40 trillionYes
Bank of America$2.54 trillionYes
Wells Fargo$1.73 trillionYes
Citi$1.68 trillionYes
6 more rows
Mar 29, 2024

What banks are failing in 2024? ›

2024 in Brief

There are no bank failures in 2024. See detailed descriptions below. For more bank failure information on a specific year, select a date from the drop down menu to the right or select a month within the graph.

What banks are most at risk right now? ›

These Banks Are the Most Vulnerable
  • First Republic Bank (FRC) . Above average liquidity risk and high capital risk.
  • Huntington Bancshares (HBAN) . Above average capital risk.
  • KeyCorp (KEY) . Above average capital risk.
  • Comerica (CMA) . ...
  • Truist Financial (TFC) . ...
  • Cullen/Frost Bankers (CFR) . ...
  • Zions Bancorporation (ZION) .
Mar 16, 2023

Which small bank share is best to buy? ›

Best Small Finance Bank Stocks in India
  • Au Small Finance Bank Ltd.
  • Equitas Small Finance Bank Ltd.
  • Ujjivan Small Finance Bank Ltd.
  • Utkarsh Small Finance Bank Ltd.
Apr 17, 2024

What are bank preferred stocks? ›

Preferred securities, also known as “preferreds” or “hybrids,” share the characteristics of both stocks and bonds, and may offer investors higher yields than common stock or corporate bonds. Understanding preferreds is an important first step in determining if they are an appropriate investment.

Are stocks better than banks? ›

Investing products such as stocks can have much higher returns than savings accounts and CDs. Over time, the Standard & Poor's 500 stock index (S&P 500), has returned about 10 percent annually, though the return can fluctuate greatly in any given year. Investing products are generally very liquid.

What Bank stocks are shorted the most? ›

ASSETSHARES SHORTSHORT % OF FLOAT
Bank of Hawaii (BOH)5.3637M18.89%
Bank Ozk (OZK)12.2629M11.66%
Valley National Bancorp (VLY)39.7043M10.89%
Bancorp (TBBK)4.5153M10.64%
24 more rows

Which is the most undervalued stock? ›

Top Undervalued Stocks: List of the Most Underrated Sector Shares in India 2024
  • ITC Ltd.
  • Asian Paints Ltd.
  • Sun Pharmaceutical Industries Ltd.
  • Avenue Supermarts Ltd.
  • Coal India Ltd.
  • Varun Beverages Ltd.
  • Eicher Motors Ltd.
  • Bharat Electronics Ltd.
Feb 19, 2024

Why Bank stocks are declining? ›

The lender's stocks declined after some analysts recently downgraded its target price, citing medium-term risks and a gradual recovery in net interest margins (NIMs).

What bank is the safest? ›

Safest Banks in the U.S.
  • CITIBANK. ...
  • WELLS FARGO. ...
  • CAPITAL ONE. ...
  • M&T BANK CORPORATION. ...
  • AGRIBANK. ...
  • COBANK. ...
  • AGFIRST. ...
  • FARM CREDIT BANK OF TEXAS. Farm Credit Bank of Texas is the fourth member of the U.S. Farm Credit System, providing wholesale lending and business services in states like Texas, Alabama, and New Mexico.
Feb 13, 2024

What is the safest bank right now? ›

Among the safest US banks, according to Global Finance's November 2022 rankings, are AgriBank, US Bank, CoBank, AgFirst Bank, and Farm Credit Bank of Texas, primarily for those in the agricultural sector.

Which bank is most trustworthy? ›

The safest banks in the U.S. for April 2024
BankThe Ascent's RatingFDIC Insured?
Capital One4.50Yes
American Express® National Bank4.50Yes
Quontic4.50Yes
Chase4.50Yes
6 more rows
Apr 11, 2024

Top Articles
Latest Posts
Recommended Articles
Article information

Author: Barbera Armstrong

Last Updated:

Views: 6343

Rating: 4.9 / 5 (79 voted)

Reviews: 94% of readers found this page helpful

Author information

Name: Barbera Armstrong

Birthday: 1992-09-12

Address: Suite 993 99852 Daugherty Causeway, Ritchiehaven, VT 49630

Phone: +5026838435397

Job: National Engineer

Hobby: Listening to music, Board games, Photography, Ice skating, LARPing, Kite flying, Rugby

Introduction: My name is Barbera Armstrong, I am a lovely, delightful, cooperative, funny, enchanting, vivacious, tender person who loves writing and wants to share my knowledge and understanding with you.