Bank of America (BAC) Gains But Lags Market: What You Should Know
In the latest trading session, Bank of America (BAC) closed at $35.84, marking a +0.53% move from the previous day. This move lagged the S&P 500's daily gain of 0.95%. Meanwhile, the Dow gained 0.6%, and the Nasdaq, a tech-heavy index, added 0.04%.
Prior to today's trading, shares of the nation's second-largest bank had lost 2.19% over the past month. This has was narrower than the Finance sector's loss of 6.49% and the S&P 500's loss of 7.49% in that time.
Wall Street will be looking for positivity from Bank of America as it approaches its next earnings report date. 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 21.36%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $23.17 billion, up 7.94% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.34 per share and revenue of $94.42 billion. These totals would mark changes of -6.44% and +5.96%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Bank of America. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.44% higher within the past month. Bank of America is currently a Zacks Rank #3 (Hold).
In terms of valuation, Bank of America is currently trading at a Forward P/E ratio of 10.69. For comparison, its industry has an average Forward P/E of 10.46, which means Bank of America is trading at a premium to the group.
Investors should also note that BAC has a PEG ratio of 1.53 right now. 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 Banks - Major Regional industry currently had an average PEG ratio of 1.53 as of yesterday's close.
The Banks - Major Regional industry is part of the Finance sector. This group has a Zacks Industry Rank of 56, putting it in the top 23% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Bank of America Corporation (BAC) : Free Stock Analysis Report
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