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Bank of America (BAC) ended the recent trading session at $45.30, demonstrating a -1.54% swing from the preceding day's closing price. This change lagged the S&P 500's 0.43% loss on the day. Meanwhile, the Dow lost 1.01%, and the Nasdaq, a tech-heavy index, lost 0.47%.
The nation's second-largest bank's stock has climbed by 0.48% in the past month, falling short of the Finance sector's gain of 3.13% and the S&P 500's gain of 2.6%.
The investment community will be closely monitoring the performance of Bank of America in its forthcoming earnings report. On that day, Bank of America is projected to report earnings of $0.81 per share, which would represent a year-over-year decline of 2.41%. At the same time, our most recent consensus estimate is projecting a revenue of $26.71 billion, reflecting a 3.47% rise from the equivalent quarter last year.
BAC's full-year Zacks Consensus Estimates are calling for earnings of $3.69 per share and revenue of $108.38 billion. These results would represent year-over-year changes of +12.5% and +6.37%, respectively.
It's also important for investors to be aware of any recent modifications to analyst estimates for Bank of America. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.23% higher. Currently, Bank of America is carrying a Zacks Rank of #3 (Hold).
In terms of valuation, Bank of America is presently being traded at a Forward P/E ratio of 12.45. Its industry sports an average Forward P/E of 14.89, so one might conclude that Bank of America is trading at a discount comparatively.
One should further note that BAC currently holds a PEG ratio of 1.24. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Financial - Investment Bank was holding an average PEG ratio of 1.16 at yesterday's closing price.