Investors seeking out value stocks at a bargain price should look no further than the U.S. banking industry, according to one market watcher who recommends buying shares of financial players before the mid-term elections roll around, according to CNBC

This Level of Overselling Likely to Result in Double Digit Rally

Bank stocks have been hit hard by the recent global sell-off, underperforming the broader market despite potential upside from rising interests rates and strong earnings. 

This week, the XLF financial ETF fell to a 13 month low, while the KBE bank ETF tracked for its worst monthly loss in over seven years. Banks including JPMorgan Chase & Co. (JPM), Citigroup (C), Goldman Sachs, (GS), Wells Fargo Corp. (WFC) and Bank of America (BAC) led the downward spiral, all sharply lower over the recent three month period. 

In light of the recent selling, Matt Maley of Miller Tabak has turned bullish on the sector at large, despite being "quite negative on the group all of this year until now." In an interview with CNBC's Trading Nation on Wednesday, the equity strategist pointing to technicals for both the KBE and the KRE regional bank ETF, indicating that the weekly relative strength index (RSI) charts are "getting very oversold." He noted that the last three times selling was this extreme, "the group bounced bank very sharply."

The KBE bank ETF currently has an RSI reading of 17, a low not observed since early 2016, when the stock rallied nearly 80% in the following 12 months. Maley said that the KRE's more recent plunge in 2011 resulted in a 64% rally over the next year. 

The analyst added that the timing of the mid-term elections could provide a particular boost to struggling sectors like financials. 

"Every single midterm election year going back to the 1950s has seen a rally in the last two months. I think that the groups that are really beaten up, that are washed out, are the ones that are going to do the best," said Maley. "You don't want to buy it all at once, but it's going to be a good group come December."

Tabak's bullish report on the banking sector echoes a note from widely followed Wells Fargo strategist Mike Mayo earlier this week. The analyst, who had also previously held a bearish view on the segment, argued that five out of five of Wall Street's Big Banks are solid buys, highlighting Morgan Stanley (MS) stock as a shining star he foresees rallying over 35%. 

Moving forward, as investors turn away from growth names like high-flying tech giants Netflix Inc. (NFLX) and instead towards lower-multiple value stocks, financials could see a major boost. The XLF ETF trades at 11 times forward earnings, compared to the S&P 500 at 16 times. Meanwhile, bank stocks are known for their healthy dividend yields, with companies like Wells Fargo yielding as much as 3.4%.