Financial stocks may be underperforming this year, but veteran bank analyst Dick Bove isn’t retreating into the bear camp.

According to the chief strategist at Hilton Capital Management on CNBC’s “Trading Nation” on Monday, second-quarter earnings should shock financials back into rally mode. It could happen as early as this Friday, when J.P. Morgan Chase kicks off earnings season.

“In terms of looking at the earnings for the quarter, you know loan volume is up. Margins are going to be flattish, but positive. Loan losses are not likely to be very bad. Expenses are going to be controlled,” Bove said.

He also noted that comparisons will highly favor 2018 due to President Donald Trump‘s tax reform package.

“During the second quarter of last year, they did not have the tax cut. So, the likelihood of earnings being up pretty good is, I think, quite high,” he added.

But Bove acknowledged the disconnect between the banks’ strong fundamentals and disappointing stock performance. He blames buyback announcements from many of the nation’s largest financial institutions.

“When the companies comes to you and say we’re going to pay you back, in the case of Citigroup, $60B over a three-year period, you have to ask yourself, ‘Why couldn’t you use that in the business?’” said Bove. “The companies are giving a very negative message.”

In January, Bove told “Trading Nation” that 2018 could see an explosive bank rally. Even though the year is halfway done, he suggested it’s not too late.

“The big banks are underperforming relative to their earnings. And, I think that the multiples continue to be relatively low in a market where multiples elsewhere are fairly high,” he noted. “The likelihood of a surge in activity for the big banks is, I think, pretty good.”

And, he believes the group’s leaders will be J.P. Morgan Chase, Bank of America and Wells Fargo — a name he refers to as a “sleeper that should be bought.”

Bove also sees big profits in regionals.

“If you go to the smaller banks, I think Silicon Valley Bank, which is SVB Financial, and First Republic should have very good quarters and are probably two of the most outstanding banks in the United States,” he added.

Disclosure: Hilton Capital Management holds shares of SVB Financial in its portfolio. Neither Bove nor the company own any shares.