HSBC downgrades Bank of America to Hold after recent rally

HSBC last night downgraded Bank of America (BAC) to Hold from Buy with a price target of $51, up from $47. The analyst is more cautious on universal banks and brokers following the recent rally in the shares. HSBC recommends a more constructive stance on super-regionals. While operating fundamentals in the banks and broker group appear healthy, share valuations are “increasingly stretched,” the analyst tells investors in a research note. Bank of America has seen material multiple expansion even as consensus estimate revisions have been unfavorable versus peers, the firm adds. It now sees limited upside in the shares.