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Bank of America Stock: Why Analysts Are Bullish

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Apr. 12 2019, Published 7:21 a.m. ET

Analysts suggest a “buy”

Bank of America’s (BAC) impressive financial performance in the past several quarters and its ability to sustain growth momentum in loans and deposits make analysts positive on its stock. Notably, banks could find it difficult to drive earnings in 2019 amid tough YoY comparisons, persisting challenges in market-sensitive products, the Fed’s pause on interest rate hikes, and competitive activity.

However, Bank of America (BAC) is expected to report improved net interest income driven by sustained growth in loans and deposits. Meanwhile, share buybacks and lower expenses are expected to support the bank’s EPS growth rate.

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Among the 31 analysts covering the stock, 19 suggest a “buy” on BAC stock, and 12 analysts recommend a “hold.” Analysts have a consensus target price of $33.17 per share on BAC, which implies an upside potential of 14.1% based on its closing price of $29.07 on April 11.

Besides BAC, Wall Street also recommends a “buy” on Citigroup (C) stock. Meanwhile, analysts have a neutral rating on the stocks of JPMorgan Chase (JPM), Wells Fargo (WFC), and Goldman Sachs (GS).

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Stock performance   

Bank of America stock is up 18.0% on a YTD basis as of April 11. Meanwhile, Citigroup and Goldman Sachs stock registered gains of 26.6% and 21.4%, respectively, in that period. JPMorgan and Wells Fargo stock are also up on a YoY basis but have lagged the broader markets. JPM and WFC are up 8.8% and 3.6% so far this year.

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