Tom Lee says a shift is underway inside the US banking sector that could change how the market values some of its biggest players.
In a new interview on CNBC, the Fundstrat co-founder says financial services firms are emerging as some of the biggest downstream beneficiaries of blockchain and AI, particularly as automation reshapes cost structures across the industry.
“But then there’s also, I think, some tailwinds building for the financial services, which you guys mentioned are doing well, which is that financial services companies are really big beneficiaries of AI. And they’re big beneficiaries of using blockchain technology. Both will allow them to reduce the employee intensity of their business.”
According to Lee, those efficiencies could translate directly into higher margins at large, technology-forward banks. He points specifically to JPMorgan Chase and Goldman Sachs as institutions that could see their market positioning change as a result.
“And so I think the large tech-forward banks are going to start to see margin expansion and trade more like tech stocks in the future. And that’s why the JPMorgans and the Goldmans could actually be the next Mag 7.”
Lee adds that regulatory changes could further amplify those gains, particularly if constraints imposed after the global financial crisis are eased without removing core safeguards.
“Well, [deregulation] would be a very big tailwind, too. As you know, banks have been strangulated, especially post-GFC (global financial crisis), and so removing some restrictions would be helpful as long as you don’t remove safeguard rails.”
He says the same macro forces could also benefit regional banks, especially in an environment of falling interest rates and rising deal activity.
“Yeah, regional banks, I think, are part of the reason we like small caps, because as interest rates decline and as business activity picks up and potentially M&A (mergers and acquisitions) pick up, this really plays into the favor of regional banks.”
Earlier this week, Wells Fargo said that financials is the bank’s most favored sector for 2026 amid M&As, deregulation and a better US economy.
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