From a valuation perspective, bank stocks are some of the most intimidating securities in the stock market. There are a seemingly endless number of variables that could be included in any particular analysis, from those dealing with interest rates, to housing values, to economic growth, and everything in between. There's nevertheless a quick and dirty way to value bank stocks that comes in extremely handy in a pinch. In the video below, Motley Fool contributor John Maxfield discusses the shortcut, as well as its strengths and weaknesses.
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A Quick and Dirty Way to Value Bank Stocks
Determining whether or not a bank stock is a buy may be easier than you think.
John Maxfield owns shares of Bank of America. The Motley Fool recommends Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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