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Based in Charlotte, North Carolina, Bank of America Corporation (BAC) offers a full range of banking, investment management, and other financial and risk management products and services to individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments. It is valued at a market cap of $350.6 billion.
Companies valued at $200 billion or more are generally described as “mega-cap” stocks and BAC fits right into that category with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the diversified banks industry. BAC is capitalizing on the digital banking revolution, leveraging its robust digital platforms to expand its customer base and market share. Strategic tech investments have enabled the company to tap into the growing demand for online banking services.
This banking giant is currently trading 4.1% below its 52-week high of $48.08, reached on Nov. 29, 2024. Shares of BAC have declined 1.6% over the past three months, slightly lagging behind the Nasdaq Composite’s ($NASX) 1.1% fall over the same time frame.
Nonetheless, in the longer term, BAC has rallied 34.1% over the past 52 weeks, outpacing NASX’s 18.2% return. Moreover, on a YTD basis, shares of BAC are up 4.8%, compared to NASX’s 2.4% decline over the same time frame.
To confirm its bullish trend, Bank of America has been trading above its 200-day moving average for the past year, and has been trading above its 50-day moving average since October 2024, with some fluctuations.
On Jan. 16, BAC shares fell nearly 1% following its Q4 earnings release, despite reporting stronger-than-expected results. The company posted a Q4 EPS of $0.82 and net revenue of $25.3 billion, reflecting a significant 134.3% year-over-year increase in earnings and a 15.4% rise in revenue.
However, investor sentiment may have been impacted by a notable annual increase in provisions for credit losses and net charge-offs, raising concerns about credit quality. Additionally, higher adjusted non-interest expenses and management’s forecast of a further 2% to 3% increase in 2025 may have further weighed on investor confidence.
Bank of America has lagged behind its rival, Citigroup Inc. (C), which rallied 44.3% over the past 52 weeks and 13.6% on a YTD basis.
Despite BAC’s recent underperformance, analysts remain highly optimistic about its prospects. The stock has a consensus rating of “Strong Buy” from the 23 analysts covering it, and the mean price target of $52.80 suggests a modest 14.5% premium to its current levels.
