Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Banks industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.
Why Focus on Undervalued Banks Stocks?
Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.
AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.
What Goes Into AAII’s Value Grade?
Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.
AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.
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6 Undervalued Banks Stocks
Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Banks industry for Thursday, May 21, 2026. Let’s take a closer look at their individual scores to see how they measure up against each other and the Banks industry median.
| Company | Ticker | Price/Sales | Price/Earnings | EV/EBITDA | Shareholder Yield | Price/Book Value | Price/Free Cash Flow | Value Grade |
| Capital City Bank Group, Inc. | CCBG | 3.17 | 13.2 | na | 1.7% | 1.42 | 13.8 | B |
| The First Bancorp, Inc. | FNLC | 3.32 | 8.9 | na | 4.9% | 1.13 | 8.1 | A |
| Franklin Financial Services Corporation | FRAF | 2.81 | 10.7 | na | 1.5% | 1.43 | 7.5 | B |
| First United Corporation | FUNC | 2.76 | 9.6 | na | 2.7% | 1.18 | 15.4 | B |
| Home Bancorp, Inc. | HBCP | 3.36 | 10.8 | na | 4.5% | 1.14 | 12.2 | B |
| Webster Financial Corporation | WBS | 4.40 | 12.0 | na | 7.9% | 1.28 | 12.9 | B |
The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.
The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)
Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).
As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.
Capital City Bank Group, Inc.’s Value Grade
Value Grade:
| Metric | Score | CCBG | Industry Median |
| Price/Sales | 64 | 3.17 | 3.26 |
| Price/Earnings | 31 | 13.2 | 11.8 |
| EV/EBITDA | na | na | 0.0 |
| Shareholder Yield | 33 | 1.7% | 2.6% |
| Price/Book Value | 38 | 1.42 | 1.14 |
| Price/Free Cash Flow | 37 | 13.8 | 15.3 |
Capital City Bank Group, Inc. operates as the financial holding company for Capital City Bank that provides a range of banking services to individual and corporate clients. The company offers financing for commercial business properties, equipment, inventories, and accounts receivable, as well as commercial leasing and letters of credit; treasury management services; and merchant credit card transaction processing services. It also provides commercial and residential real estate lending products, as well as fixed and adjustable-rate residential mortgage loans; personal, automobile, boat/RV, and home equity loans. In addition, the company offers institutional banking services, including customized checking and savings accounts, cash management systems, tax-exempt loans, lines of credit, and term loans to meet the needs of state and local governments, public schools and colleges, charities, membership, and not-for-profit associations. Further, it provides consumer banking services comprising checking accounts, savings programs, interactive/automated teller machines, debit/credit cards, night deposit services, safe deposit facilities, and online and mobile banking services. Additionally, the company provides asset management for individuals through agency, personal trust, IRA, and personal investment management accounts; and various retail investment products, such as the U.S. government bonds, tax-free municipal bonds, stocks, mutual funds, unit investment trusts, annuities, life insurance, and long-term health care, as well as business, estate, financial, insurance and business planning, tax planning, and asset protection advisory services. Further, the company offers mortgage banking. Capital City Bank Group, Inc. was founded in 1895 and is headquartered in Tallahassee, Florida.
Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.
Capital City Bank Group, Inc. has a Value Score of 63, which is considered to be undervalued.
When you look at Capital City Bank Group, Inc.’s price-to-sales ratio at 3.17 compared to the industry median at 3.26, this company has a lower price relative to revenue compared to its peers. This could make Capital City Bank Group, Inc.’s stock more attractive for value investors.
Capital City Bank Group, Inc.’s price-earnings ratio is 13.20 compared to the industry median at 11.80. This means it has a higher share price relative to earnings compared to its peers. This could make Capital City Bank Group, Inc. less attractive for value investors.
Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Capital City Bank Group, Inc.’s shareholder yield is lower than its industry median ratio of 2.60%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.
As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Capital City Bank Group, Inc.’s price-to-book ratio is higher than its industry median ratio of 1.14. This could make Capital City Bank Group, Inc. less attractive to investors looking for a new addition to their portfolio.
Lastly, let’s take a look at Capital City Bank Group, Inc.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Capital City Bank Group, Inc.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 15.30. This could make Capital City Bank Group, Inc. more attractive because the lower P/FCF ratio indicates that Capital City Bank Group, Inc. is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.
The First Bancorp, Inc.’s Value Grade
Value Grade:
| Metric | Score | FNLC | Industry Median |
| Price/Sales | 66 | 3.32 | 3.26 |
| Price/Earnings | 13 | 8.9 | 11.8 |
| EV/EBITDA | na | na | 0.0 |
| Shareholder Yield | 16 | 4.9% | 2.6% |
| Price/Book Value | 28 | 1.13 | 1.14 |
| Price/Free Cash Flow | 19 | 8.1 | 15.3 |
The First Bancorp, Inc. operates as the bank holding company for First National Bank that provides a range of banking products and services to individual and corporate customers. It accepts various deposit products, including demand, NOW, time, savings, money market, and certificates of deposit accounts. The company also provides commercial loans, such as mortgage loans to finance investments in real property, which includes retail spaces, offices, industrial buildings, hotels, educational facilities, and other specific or mixed use properties; commercial real estate non-owner occupied loans; commercial construction to finance construction in a mix of owner- and nonowner occupied commercial real estate properties; and commercial and industrial loans, including revolving and term loans for financing working capital and/or capital investment. In addition, it offers commercial multifamily loans; residential real estate term and construction loans; loans to municipalities in Maine for capitalized expenditures, construction projects, or tax anticipation notes; home equity revolving and term loans; and personal lines of credit and amortizing loans for various purposes, such as autos, recreational vehicles, debt consolidation, personal expenses, or overdraft protection. Further, the company offers private banking, financial planning, investment management, and trust services to individuals, businesses, non-profit organizations, and municipalities, as well as brokerage, annuity, and various insurance products. It operates through full-service banking offices in Lincoln, Knox, Waldo, Penobscot, Hancock, and Washington counties in the Mid-Coast, Eastern, and Down East regions of Maine. The company was formerly known as First National Lincoln Corporation and changed its name to The First Bancorp, Inc. in April 2008. The First Bancorp, Inc. was founded in 1864 and is based in Damariscotta, Maine.
Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.
The First Bancorp, Inc. has a Value Score of 86, which is considered to be undervalued.
The First Bancorp, Inc.’s price-earnings ratio is 8.9 compared to the industry median at 11.8. This means that it has a lower price relative to its earnings compared to its peers. This makes The First Bancorp, Inc. more attractive for value investors.
The First Bancorp, Inc.’s price-to-book ratio is lower than its peers. This could make The First Bancorp, Inc. fairly attractive for value investors when compared to the industry median at 1.14.
You can read more about The First Bancorp, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.
Franklin Financial Services Corporation’s Value Grade
Value Grade:
| Metric | Score | FRAF | Industry Median |
| Price/Sales | 60 | 2.81 | 3.26 |
| Price/Earnings | 20 | 10.7 | 11.8 |
| EV/EBITDA | na | na | 0.0 |
| Shareholder Yield | 34 | 1.5% | 2.6% |
| Price/Book Value | 38 | 1.43 | 1.14 |
| Price/Free Cash Flow | 17 | 7.5 | 15.3 |
Franklin Financial Services Corporation operates as the bank holding company for Farmers and Merchants Trust Company of Chambersburg that provides banking services to businesses, individuals, and governmental entities in Pennsylvania. It offers various deposit products, including demand deposits, savings, money management accounts, time deposits, and certificates of deposits. The company also provides commercial real estate, construction and land development, commercial and industrial, and residential mortgage loans, as well as installment and revolving loans; consumer loans comprising unsecured personal lines of credit and installment loans; and secured and unsecured commercial and industrial loans, including accounts receivable and inventory financing, and commercial equipment financing. In addition, it offers various trust services comprising estate planning and administration, corporate and personal trust fund management, pension, and profit sharing and other employee benefit funds management services, and custodial services, as well as non-trust related investment services; sells mutual funds, annuities, and insurance products; safe deposit; and pension and fiduciary services. Further, the company engages in non-bank investment activities, such as venture capital investments. The company was founded in 1906 and is headquartered in Chambersburg, Pennsylvania.
Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.
Franklin Financial Services Corporation has a Value Score of 77, which is considered to be undervalued.
Franklin Financial Services Corporation’s price-earnings ratio is 10.7 compared to the industry median at 11.8. This means that it has a lower price relative to its earnings compared to its peers. This makes Franklin Financial Services Corporation more attractive for value investors.
Franklin Financial Services Corporation’s price-to-book ratio is lower than its peers. This could make Franklin Financial Services Corporation more attractive for value investors when compared to the industry median at 1.14.
You can read more about Franklin Financial Services Corporation’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.
First United Corporation’s Value Grade
Value Grade:
| Metric | Score | FUNC | Industry Median |
| Price/Sales | 59 | 2.76 | 3.26 |
| Price/Earnings | 16 | 9.6 | 11.8 |
| EV/EBITDA | na | na | 0.0 |
| Shareholder Yield | 27 | 2.7% | 2.6% |
| Price/Book Value | 30 | 1.18 | 1.14 |
| Price/Free Cash Flow | 42 | 15.4 | 15.3 |
First United Corporation operates as the bank holding company for First United Bank & Trust that provides various retail and commercial banking services to businesses and individuals in the United States. It operates through Community Banking and Wealth Management segments. The company offers deposit products, such as checking, savings, money market, individual retirement (IRA), employee benefit, and health savings accounts; regular and IRA certificates of deposit (CD); and demand deposits. It also provides business and personal loans; commercial loans secured by real estate, commercial equipment, and vehicles or other assets of the borrower; residential mortgages; home equity lines of credit; real estate construction loans to builders and individuals for single-family dwellings; and consumer loans, including indirect and direct auto loans, student loans, and other secured and unsecured lines of credit and term loans. In addition, the company offers brokerage; certificate of deposit account registry and IntraFi cash services; treasury management, cash sweep, and various checking opportunities; trust services, such as personal trust, investment agency accounts, charitable trusts, estate administration, and estate planning, as well as retirement accounts, including IRA rollovers, 401(k) accounts, and defined benefit plans; safe deposit and night depository facilities; and insurance products. Further, it provides online, mobile, and digital banking; debit and credit cards; business support; merchant services; remote deposit capture; positive pay; sweep and escrow accounts; check recovery and ordering; equipment loans; floorplan lending; mobile wallet and deposit; credit insights; personal finance; bill pay; CD and trust secured loans; boat and RV loans; and retirement planning services. First United Corporation was founded in 1900 and is headquartered in Oakland, Maryland.
Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.
First United Corporation has a Value Score of 75, which is considered to be undervalued.
First United Corporation’s price-earnings ratio is 9.6 compared to the industry median at 11.8. This means that it has a lower price relative to its earnings compared to its peers. This makes First United Corporation more attractive for value investors.
First United Corporation’s price-to-book ratio is lower than its peers. This could make First United Corporation more attractive for value investors when compared to the industry median at 1.14.
You can read more about First United Corporation’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.
Home Bancorp, Inc.’s Value Grade
Value Grade:
| Metric | Score | HBCP | Industry Median |
| Price/Sales | 66 | 3.36 | 3.26 |
| Price/Earnings | 21 | 10.8 | 11.8 |
| EV/EBITDA | na | na | 0.0 |
| Shareholder Yield | 18 | 4.5% | 2.6% |
| Price/Book Value | 29 | 1.14 | 1.14 |
| Price/Free Cash Flow | 31 | 12.2 | 15.3 |
Home Bancorp, Inc. operates as the bank holding company for Home Bank, National Association that provides various banking products and services for individuals and businesses in Louisiana, Mississippi, and Texas, the United States. The company offers deposit products, including interest-bearing and noninterest-bearing checking, money market, savings, NOW, and certificates of deposit accounts; custodial accounts; health savings and individual retirement accounts; and statement savings. It also provides various loan products comprising one-to four-family first mortgage loans, home equity loans and lines, commercial real estate loans, construction and land loans, multi-family residential loans, commercial and industrial loans, and consumer loans; personal loans, including auto, savings and CD secured, unsecured, and credit builder loans; and business loans, such as business term and SBA loans. In addition, the company invests in loans and securities. Further, it offers debit and credit cards; account services; treasury management, such as online banking and bill pay, mobile banking, remote deposit capture, positive pay, and ACH positive pay services; merchant card services; and payroll cards. Home Bancorp, Inc. was founded in 1908 and is headquartered in Lafayette, Louisiana.
Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.
Home Bancorp, Inc. has a Value Score of 79, which is considered to be undervalued.
Home Bancorp, Inc.’s price-earnings ratio is 10.8 compared to the industry median at 11.8. This means that it has a lower price relative to its earnings compared to its peers. This makes Home Bancorp, Inc. more attractive for value investors.
Home Bancorp, Inc.’s price-to-book ratio is lower than its peers. This could make Home Bancorp, Inc. fairly attractive for value investors when compared to the industry median at 1.14.
You can read more about Home Bancorp, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.
Webster Financial Corporation’s Value Grade
Value Grade:
| Metric | Score | WBS | Industry Median |
| Price/Sales | 75 | 4.40 | 3.26 |
| Price/Earnings | 27 | 12.0 | 11.8 |
| EV/EBITDA | na | na | 0.0 |
| Shareholder Yield | 8 | 7.9% | 2.6% |
| Price/Book Value | 33 | 1.28 | 1.14 |
| Price/Free Cash Flow | 34 | 12.9 | 15.3 |
Webster Financial Corporation operates as the bank holding company for Webster Bank, National Association that provides various financial products and services to businesses, individuals, and families in the United States. It operates through three segments: Commercial Banking, Healthcare Financial Services, and Consumer Banking. The company offers checking, savings, and money market accounts; time deposits; individual retirement account retirement savings; certificates of deposit; mortgages; home equity loans and lines of credit; business lines of credit; overdrafts; and term, commercial mortgages, student, PPA, SBA, and personal loans. It also provides commercial lending; financial planning, life and long-term insurance, personal retirement, and portfolio management solutions; employee retirement plans; credit cards; payroll services; automated clearing house payables and wires; bill pay, remote deposit capture, merchant, and lockbox services; treasury management and investment services; private banking services; wealth management services; and online and mobile banking services. Webster Financial Corporation was founded in 1870 and is headquartered in Stamford, Connecticut.
Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.
Webster Financial Corporation has a Value Score of 74, which is considered to be undervalued.
Webster Financial Corporation’s price-earnings ratio is 12.0 compared to the industry median at 11.8. This means that it has a higher price relative to its earnings compared to its peers. This makes Webster Financial Corporation less attractive for value investors.
Webster Financial Corporation’s price-to-book ratio is lower than its peers. This could make Webster Financial Corporation more attractive for value investors when compared to the industry median at 1.14.
You can read more about Webster Financial Corporation’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.
Other Banks Stock Grades
Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.
Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Banks stocks as well as other industrys.
Choosing Which of the 6 Best Banks Stocks Is Right for You
Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.
- Capital City Bank Group, Inc. stock has a Value Grade of B.
- The First Bancorp, Inc. stock has a Value Grade of A.
- Franklin Financial Services Corporation stock has a Value Grade of B.
- First United Corporation stock has a Value Grade of B.
- Home Bancorp, Inc. stock has a Value Grade of B.
- Webster Financial Corporation stock has a Value Grade of B.
Now that you have a bit more background about each of the 6 undervalued stocks in the Banks industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.
We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.
A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.
Additional Resources About Banks Stocks
Want to learn more about Banks stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.
- 6 Undervalued Banks Stocks for Wednesday, May 20
- Is Banco Santander, S.A. (SAN) Overvalued?
- Is Bank of America Corporation (BAC) Overvalued?
- Is HSBC Holdings plc (HSBC) Overvalued?
AAII Disclaimer
We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.
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