1 Bank Stock on Our Buy List and 2 We Find Risky Petr Huřťák Tue, October 13, 2026 at 4:27 AM EDT 4 min read MBIN +0.18% ^GSPC -0.06% SFBS +0.83% GABC +1.37% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Banks use their capital and expertise to help businesses grow while offering consumers essential financial products like mortgages and credit cards. Still, investors are uneasy as banks face challenges from credit quality concerns and potential regulatory changes. These doubts have caused the industry to lag recently as banking stocks have collectively shed 2.3% over the past six months. This drawdown is a stark contrast from the S&P 500's 13.5% gain.
Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. Taking that into account, here is one bank stock poised to generate sustainable market-beating returns and two we're passing on.
With a strategic focus on low-risk, government-backed lending programs, Merchants Bancorp (NASDAQCM:MBIN) is an Indiana-based bank holding company specializing in multi-family mortgage banking, mortgage warehousing, and traditional banking services.
Why Do We Think Twice About MBIN?
Annual revenue growth of 5.6% over the last two years was below our standards for the banking sector
Operational productivity has decreased over the last five years as its efficiency ratio worsened by 16.6 percentage points
Low tier one capital ratio of 9.4% indicates the company may struggle to maintain adequate liquidity during periods of economic stress
At $49.04 per share, Merchants Bancorp trades at 1x forward P/B. Read our free research report to see why you should think twice about including MBIN in your portfolio, it's free.
Founded in 1910 during a wave of community banking expansion in the Midwest, German American Bancorp (NASDAQ:GABC) is a financial holding company that provides banking, wealth management, and insurance services across southern Indiana and Kentucky.
Efficiency ratio is projected to stay flat over the coming year, suggesting its fixed cost leverage is currently maxed out
Performance over the past five years shows its incremental sales were less profitable, as its 4.9% annual earnings per share growth trailed its revenue gains
1.9% annual tangible book value per share growth over the last five years was slower than its banking peers
German American Bancorp's stock price of $48.83 implies a valuation ratio of 1.4x forward P/B. If you're considering GABC for your portfolio, see our FREE research report to learn more.
Founded in 2005 with a focus on serving underserved mid-sized businesses, ServisFirst Bancshares (NYSE:SFBS) is a bank holding company that provides commercial banking services to businesses and professionals through its subsidiary ServisFirst Bank.
Annual revenue growth of 19.5% over the last two years was superb and indicates its market share increased during this cycle
Net interest margin grew by 71.1 basis points (100 basis points = 1 percentage point) over the last two years, giving the firm more chips to play with
Additional sales over the last two years increased its profitability as the 25.7% annual growth in its earnings per share outpaced its revenue
ServisFirst Bancshares is trading at $38.74 per share, or 2x forward P/B. Is now the right time to buy? See for yourself in our comprehensive research report, it's free.
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