These 3 Bank Stocks to Buy Just Earned "Top Scores"

bank stocksLet's face it. Banking stocks can be boring. But if you want to generate consistent returns, there is perhaps no better place to put your money...

Banks across the United States have been consolidating since the 1980s. Just 15 years ago, there were about 15,000 banks. Today, that number is less than 6,000.

And in the wake of a mega-merger between BB&T Corp. (NYSE: BBT) and SunTrust Banks Inc. (NYSE: STI), we expect that banking deals will continue well into the future.

It turns out that Money Morning Special Situation Specialist Tim Melvin is one of the world's - yes, the world's - best banking analysts.

7-Day Cash Course: With the secrets in this video series, you could potentially start collecting anywhere from $1,190, $1,313, and even $2,830 in consistent income - each and every week. And it can be yours for only $1...

Since 2013, Tim has made 45 picks for banks - all of which made money. That's right, a perfect track record. Better yet, his total return across all picks is a stunning 100.8%.

For example, in June 2014, Tim recommended investors buy a little bank called Coastway Bancorp for $10.80 per share. It was acquired in May 2018 for $27.20 by Harborone Bank (NASDAQ: HONE).

Over the 47 months that Tim recommended investors to buy and hold Coastway shares, the total return was 151.8%.

Then, there was Bay Bancorp - a small bank he found and wrote about in September 2015 for $5.14 per share. The company sold in November 2017 for $11.97 per share. That was a total return of 132.9% in just 26 months.

And in March 2016, he recommended a tiny bank called Royal Bank of Pennsylvania for $1.99. Just 20 months later, when it sold to Bryn Mawr Bank Corp. (NASDAQ: BMTC), his readers earned 130.2%.

And Tim has given many of his bonus banking stocks - the ones averaging 20% returns per year - to his Heatseekers readers since the inception of his premium proprietary service.

At Money Morning, we have another way to tap into banking stocks that are about to take off.

It's called VQScore, and it's telling us that these three bank stocks to buy are ready to explode in share price in 2019 and beyond...

Best Bank Stocks to Buy Now, No. 3

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Hope Bancorp Inc. (NASDAQ: HOPE) isn't any ordinary bank. It's the first and only super regional Korean-American bank in the United States.

With $15.3 billion in assets, the holding company for the Bank of Hope operates 63 full-service branches in nine states. It also has SBA loan production offices in Seattle, Denver, Dallas, Atlanta, Portland, Oregon, New York City, Northern California, and Houston; offers residential mortgages in California; and operates a representative office in Seoul, Korea.

The company trades at a price to book value of just 0.95 against an industry average of 3.12, according to Reuters data. Its price to sales is 3.29, which is less than half the industry average of 8.24.

But the most important number is its VQScore. Money Morning's proprietary VQScore system tracks more than 1,500 profitable companies.

Based on all the metrics, the VQScore ranks stocks from a 1 to 4.75. The higher, the better.

Stocks with our highest scores are the ones to buy because the VQScore has determined the stock is ready to break out.

Hope Bancorp currently holds our score of 4.75, indicating the stock is a "Strong Buy." And we think you could bank at least 20% returns over the next year with this pick.

Best Banks Stocks to Buy Now, No. 2

Sandy Spring Bancorp Inc. (NASDAQ: SASR) isn't a bank likely to be acquired. Not when it's trading at a price-to-tangible-book value of 1.69. But the firm and its community banking, insurance, and investment management divisions continue to grow across the Mid-Atlantic...

In recent years, Sandy Spring has been a prospective bank buyer.

In May 2017, the firm purchased WashingtonFirst Bank for $89 million. That deal helped the firm expand its foothold in the Washington, D.C., region, which contains aggressively growing suburbs.

SASR stock currently has a one-year consensus price target of $36 per share. That figure represents a potential upside of 9.8% from Tuesday's closing price.

However, with a VQScore of 4.75, a solid 3.5% dividend, and consistent growth in a booming area of the country, investors should be looking more toward a value of $40 or more by the end of the year. That's 25% higher from here.

Best Banks Stocks to Buy Now, No. 1

Capital One Financial Corp. (NYSE: COF) may be one of the most beaten-up banking stocks in the business, but we can afford to be greedy when others are fearful because the VQScore is primarily a value-driven algorithm built for the contrarian long-term investor.

You might recognize Capital One from the massive swarm of direct mail that you used to receive in the last decade. The company's goal was to be the only thing in your mailbox at a time that direct mail was giving way to email and digital marketing.

But times have changed, with shares of COF stock falling from a 2018 high of $101.26 last May to under $70 during the December correction. The stock has since rebounded to $80 per share.

Capital One trades at a price-to-tangible-book value of 1.07, with a price-to-free-cash-flow of just 4.87. Both numbers are insanely cheap.

And based on the stock's VQScore of 4.75, there is much higher to go. The average price target on Wall Street sits at $103.27. That figure represents an upside of 22.3% from Tuesday's closing price.

But if the company rebounds the way we expect, shares will rise to $137. That's 71% upside from current levels.

Never Buy a Losing Stock Again: Our newest editor, Tim Melvin, has developed a strategy that eliminates stock losses and allows him to close out positions with 300%, 500%, even 787% upside. How does he do it? Find out right here before he takes this video down forever!

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