U.S. Markets closed

Why Bank of America Is a Bargain

Matthew Johnston

Bank of America Corp. ( BAC), which more than doubled over the three years through mid-March of this year to reach its highest level since just before nearly going under during the financial crisis, is now down almost 15% off that March high. Banking analyst Mike Mayo at Wells Fargo, who has an outperform rating on the stock and a price target of $37, told Barron’s, “I hear all the time that these are peak earnings for Bank of America. A strong investment case could be made for each of the big six as all of them are trading within a range of 8 to 11 times forward earnings compared to the S&P 500’s forward multiple of 16.4, and nonperforming assets are at relatively low levels across the banking sector.