Banks play a critical role in the financial system, providing everything from commercial loans to wealth management and payment processing services. But worries about an economic slowdown and potential credit deterioration have kept sentiment in check, and over the past six months, the banking industry’s 5.2% return has trailed the S&P 500 by 3.4 percentage points.

The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. With that said, here is one bank stock poised to generate sustainable market-beating returns and two we’re passing on.

Two Bank Stocks to Sell:

National Bank Holdings (NBHC)

Market Cap: $1.50 billion

Operating under familiar local brands like Community Banks of Colorado, Bank Midwest, and Bank of Jackson Hole, National Bank Holdings (NYSE: NBHC) operates regional banks across Colorado, Kansas, Missouri, Wyoming, Texas, and other western states, offering commercial, business, and consumer banking services.

Why Does NBHC Worry Us?

1. Flat sales over the last two years suggest it must find different ways to grow during this cycle
2. Net interest margin shrank by 24 basis points (100 basis points = 1 percentage point) over the last two years, suggesting the profitability of its loan book is decreasing or the market is becoming more competitive
3. Overall productivity is expected to decrease over the next year as Wall Street thinks its efficiency ratio will degrade by 4.8 percentage points

National Bank Holdings is trading at $39.31 per share, or 1.1x forward P/B. If you’re considering NBHC for your portfolio, see our FREE research report to learn more.

Independent Bank (INDB)

Market Cap: $3.54 billion

Tracing its roots back to 1907 and serving as a financial cornerstone in New England for over a century, Independent Bank Corp. (NASDAQ: INDB) operates as the holding company for Rockland Trust, providing banking, investment, and financial services across Eastern Massachusetts and Rhode Island.

Why Are We Hesitant About INDB?

1. Sales tumbled by 3.3% annually over the last two years, showing market trends are working against its favor during this cycle
2. Net interest margin shrank by 29.7 basis points (100 basis points = 1 percentage point) over the last two years, suggesting the profitability of its loan book is decreasing or the market is becoming more competitive
3. Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 13.4% annually, worse than its revenue

Independent Bank’s stock price of $70.94 implies a valuation ratio of 1x forward P/B. Dive into our free research report to see why there are better opportunities than INDB.

One Bank Stock to Watch:

First Busey (BUSE)

Market Cap: $2.15 billion

Tracing its roots back to 1868 during America's post-Civil War reconstruction era, First Busey (NASDAQ: BUSE) is a bank holding company that provides commercial and retail banking, wealth management, and payment technology solutions across Illinois, Missouri, Florida, and Indiana.

Why Are We Positive On BUSE?

1. Market share has increased this cycle as its 12.9% annual net interest income growth over the last five years was exceptional
2. Market share is on track to rise over the next 12 months as its 50.7% projected net interest income growth implies demand will accelerate from its five-year trend
3. Annual tangible book value per share growth of 19% over the last two years was superb and indicates its capital strength increased during this cycle

At $24.17 per share, First Busey trades at 0.9x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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