While the S&P 500 is up 16.6% since April 2026, Fifth Third Bancorp (currently trading at $50.46 per share) has lagged behind, posting a return of 7.8%. This might have investors contemplating their next move.
Is now the time to buy Fifth Third Bancorp, or should you be careful about including it in your portfolio? Dive into our full research report to see our analyst team’s opinion, it’s free.
Why Is Fifth Third Bancorp Not Exciting?
We don’t have much confidence in Fifth Third Bancorp. Here are three reasons you should be careful with FITB, plus one stock we’d rather own.
1. Net Interest Income Points to Soft Demand
Our experience and research show the market cares primarily about a bank’s net interest income growth as one-time fees are considered a lower-quality and non-recurring revenue source.
Fifth Third Bancorp’s net interest income has grown at a 8.7% annualized rate over the last five years, slightly worse than the broader banking industry. Its growth was driven by both an increase in its outstanding loans and net interest margin, which represents how much a bank earns in relation to its outstanding loan book.
2. EPS Barely Growing
Analyzing the long-term change in earnings per share (EPS) shows whether a company’s incremental sales were profitable — for example, revenue could be inflated through excessive spending on advertising and promotions.
Fifth Third Bancorp’s EPS grew at a weak 1.1% compounded annual growth rate over the last five years, lower than its 6.7% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded.
3. Growing TBVPS Reflects Strong Asset Base
Tangible book value per share (TBVPS) serves as a key indicator of a bank’s financial strength, representing the hard assets available to shareholders after removing intangible assets that could evaporate during financial distress.
Although Fifth Third Bancorp’s TBVPS was flat over the last five years, the good news is that its growth has recently accelerated as TBVPS grew at an impressive 14.4% annual clip over the past two years (from $17.75 to $23.23 per share).
Final Judgment
Fifth Third Bancorp’s business quality ultimately falls short of our standards. With its shares underperforming the market lately, the stock trades at 1.4× forward P/B (or $50.46 per share). While this valuation is reasonable, we don’t really see a big opportunity at the moment. We’re pretty confident there are more exciting stocks to buy at the moment. We’d recommend looking at one of our all-time favorite software stocks.
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