Are bank stocks a good bet for investors after the stress test?

— -- The stress now for bank stock investors is the fear of missing out.

After the release of bank stress test results last week, bank stocks are racing ahead, prompting investors to wonder if they should jump in.

The SPDR KBW Bank exchange traded fund KBE, which mirrors shares of the top banks, has soared 132% from its March 6 low, topping the 36% gain since then by the Standard & Poor's 500.

Investors' view on banks "went from certain death to possible survival," says David Ellison of FBR Equity Funds. "You make money on financials when you go from ugly to OK."

While bank stocks are already up, some analysts think there's still room to make money because some stocks are:

•Still at depressed levels. While bank stocks have surged from the bottom, they're still practically flat for the year, says Anthony Polini of Raymond James. Bank of AmericaBAC, for instance, is up 372% from its March low but is still nearly 1% below its level at the end of the 2008. "The bounce back is real," he says. "The worst is behind us."

•Undervalued relative to the value of their assets. CitigroupC, for instance, ended last year with $119 billion in high-quality so-called Tier 1 capital. Even if $50 billion in government loans is subtracted, the company's true capital level of about $50 billion still exceeds its market value of $21 billion, says Robert Maltbie of Singular Research. "Citi has more upside," he says.

Also, the easing of mark-to-market accounting rules this year reduces the risk of sudden write-downs, he says.

•Likely to benefit from a better banking climate. Not only is the economy expected to heal, but banks may borrow at historically low rates, says Jim Paulsen at Wells Capital Management. There's also strong demand for mortgage loans. "It's a good operating environment for banks," Paulsen says.

Banks can just do their normal business and generate earnings that may exceed estimates, Ellison says. In addition, many of the mortgages being written now will be highly profitable because they're based on depressed prices and conservative assumptions, he says.

Some bank stocks, such as JPMorgan Chase JPM, could rise an additional 25% once investors consider earnings potential, not just survival, Maltbie says.

•Due for a lift from higher investor confidence. Now that investors have a general idea of how much more capital banks must raise, they can be more confident owning the stocks, says Edward Wedbush, CEO of brokerage Wedbush Morgan.

Not everyone is convinced, though. Investors could do better with stocks in other industries, Maltbie says.

David Ritter of Argus Research says investors who think the banking crisis is over are deluding themselves. Refinancing activity and bond trading now helping banks are temporary, and problems with business loans are just starting, he says. "There will be poor earnings over the next couple of years. I'm not sure people have priced that in."