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Wall Street Analysts Hinting at Bank of America’s Outperformance

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Improved ratings

Wall Street analysts have upgraded Bank of America’s “buy” rating and target price in August 2017 on improved trading revenue expectations and higher interest income in 3Q17. Commercial bankers (XLF) could see marginally higher growth in 3Q17 compared to the previous quarter, largely due to a rebound in trading activity. In August 2017, 23 of the 31 analysts (~74.0%) covering Bank of America (BAC) gave the stock a “buy” or “strong buy” rating. That reflects higher growth expectations from its core banking business and expected reforms in the financial and manufacturing sectors.

BAC had one “sell” recommendation in August 2017 compared to no “sell” recommendations in March 2017. The bank’s mean price target is $27 per share, implying a 12.8% rise from its current price.

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Industry ratings

Among BAC’s major competitors, JPMorgan Chase (JPM) has 15 of its 29 analysts rating it a “buy” or “strong buy” in August 2017. The ratings highlight the bank’s risk management, lower trading declines, core banking growth, credit card activity, and asset management. Twelve analysts rated JPM a “hold,” and only two analysts rated it an “underperform” or “sell” in August 2017.

For Citigroup (C), 17 of the 29 analysts covering the stock gave it a “buy” or “strong buy” rating. Ten analysts rated it a “hold,” and two rated it “underperform” or “sell.”

For Wells Fargo (WFC), 12 of the 30 analysts (~40.0%) covering the bank gave it a “buy” or “strong buy” rating, reflecting subdued core banking growth and declining efficiency. Thirteen analysts covering the stock gave it a “hold” rating, and another five gave it an “underperform” rating.

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