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Bank of America (BAC)
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Bank of America (BAC) AI Stock Analysis

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BAC

Bank of America

(NYSE:BAC)

Rating:79Outperform
Price Target:
$55.00
â–²(8.40% Upside)
Bank of America's strong earnings growth and positive technical indicators are the primary drivers of its high score. The bank's effective capital management and dividend policies enhance its attractiveness. However, financial risks due to leverage and commercial real estate exposures temper the outlook.
Positive Factors
Capital Returns
The company engaged in share repurchases totaling $5.3 billion, indicating a commitment to capital returns to shareholders.
Profitability
Profitability improvement driven by strong execution with marginal changes to strategy in recent years, including improved efficiency, deeper client relationships, and advisor retention.
Negative Factors
Interest Income
Possible slower recovery in net interest income and higher expense growth rate have shaken investor confidence.
Tax Rates
The elimination of solar/wind incentives is likely to modestly increase the tax rate, which could hurt earnings per share over the next few years.

Bank of America (BAC) vs. SPDR S&P 500 ETF (SPY)

Bank of America Business Overview & Revenue Model

Company DescriptionBank of America Corporation, through its subsidiaries, provides banking and financial products and services for individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments worldwide. Its Consumer Banking segment offers traditional and money market savings accounts, certificates of deposit and IRAs, noninterest-and interest-bearing checking accounts, and investment accounts and products; and credit and debit cards, residential mortgages, and home equity loans, as well as direct and indirect loans, such as automotive, recreational vehicle, and consumer personal loans. The company's Global Wealth & Investment Management segment offers investment management, brokerage, banking, and trust and retirement products and services; and wealth management solutions, as well as customized solutions, including specialty asset management services. Its Global Banking segment provides lending products and services, including commercial loans, leases, commitment facilities, trade finance, and commercial real estate and asset-based lending; treasury solutions, such as treasury management, foreign exchange, and short-term investing options and merchant services; working capital management solutions; and debt and equity underwriting and distribution, and merger-related and other advisory services. The company's Global Markets segment offers market-making, financing, securities clearing, settlement, and custody services, as well as risk management products using interest rate, equity, credit, currency and commodity derivatives, foreign exchange, fixed-income, and mortgage-related products. As of December 31, 2021, it served approximately 67 million consumer and small business clients with approximately 4,200 retail financial centers; approximately 16,000 ATMs; and digital banking platforms with approximately 41 million active users. The company was founded in 1784 and is based in Charlotte, North Carolina.
How the Company Makes MoneyBank of America generates revenue through multiple key streams. Primarily, it earns interest income from loans, including personal loans, mortgages, and business loans, which are charged at higher rates than the interest paid on deposits. Additionally, the bank generates fee income from various services, such as account maintenance fees, transaction fees, and ATM fees. Investment banking services, including underwriting and advisory fees, contribute significantly to revenue, as do asset management and wealth management services. The bank also benefits from trading and investment activities in its Global Markets division. Strategic partnerships with financial technology firms and other businesses enhance its product offerings and customer reach, further bolstering its earnings potential.

Bank of America Key Performance Indicators (KPIs)

Any
Any
Consumer Checking Accounts
Consumer Checking Accounts
Tracks the number of consumer checking accounts, reflecting customer base size and engagement, which are critical for cross-selling opportunities.
Chart InsightsBank of America's Consumer Checking Accounts have shown consistent growth, reflecting strong consumer banking performance. The latest earnings call highlights a strategic focus on organic growth and technology innovation, contributing to this upward trend. The addition of 5 million new accounts over six years underscores the bank's successful customer acquisition strategy. Despite challenges in commercial real estate, the bank's robust deposit growth and record net interest income signal a positive outlook for continued expansion in consumer banking.
Data provided by:Main Street Data

Bank of America Earnings Call Summary

Earnings Call Date:Jul 16, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 15, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view of Bank of America's performance, with strong revenue and earnings growth, solid deposit and market performance, and technological advancements being major positives. However, challenges in commercial real estate, regulatory costs, and expense growth highlighted areas of concern.
Q2-2025 Updates
Positive Updates
Record Revenue and Earnings Growth
Bank of America reported revenue of $26.6 billion, net income of $7.1 billion, and earnings per share of $0.89 for Q2 2025. Year-over-year, revenue grew by 4% and earnings per share by 7%.
Net Interest Income Growth
Net interest income reached a record $14.8 billion, growing 7% from Q2 2024. This marks the fourth consecutive quarter of NII growth.
Strong Deposit Growth
Deposits have grown for eight consecutive quarters. Average consumer deposits increased for the third consecutive quarter, with balances up year-over-year for the first time since 2022.
AI and Technology Advancements
Bank of America is leveraging AI and machine learning, with 1,400 AI patents and over 250 AI models. AI applications like Erica are enhancing efficiency and customer interaction.
Global Markets Performance
Global Markets reported a record second quarter level of sales and trading revenue, with revenue up 15% over the prior year quarter.
Capital Return to Shareholders
In Q2, the bank repurchased $5.3 billion in shares and paid $2 billion in dividends, totaling $13.7 billion in capital returned in the first half of 2025, 40% higher than the first half of 2024.
Negative Updates
Commercial Real Estate Challenges
Elevated commercial real estate office charge-offs offset lower consumer net charge-offs, impacting profitability modestly.
Regulatory and Compliance Costs
Increased expenses due to regulatory and compliance demands, including AML-related costs.
Expense Growth
Expenses reported at $17.2 billion, with a potential increase in expenses related to regulatory costs and market-related activities.
Company Guidance
In the Bank of America's second-quarter 2025 earnings call, the company provided detailed guidance on several key metrics. The bank reported a revenue of $26.6 billion on an FTE basis, with a net income of $7.1 billion after tax, resulting in earnings per share of $0.89. They achieved a 4% year-over-year revenue growth and a 7% growth in earnings per share. The return on assets was 83 basis points, and the return on tangible common equity was 13.4%. Notably, net interest income (NII) reached a record $14.8 billion, growing 7% from the previous year, attributed to disciplined deposit pricing and continuous organic growth. The bank's market-related revenue saw a 15% increase over the prior year's quarter, bolstered by investment banking fees exceeding $1.4 billion. Operational expenses were reported below $17.2 billion, a reduction of $600 million from the first quarter of 2025. Furthermore, the bank repurchased $5.3 billion in shares and paid $2 billion in dividends, marking a 40% increase in total capital return compared to the first half of 2024. The bank also emphasized its ongoing investment in AI and technology to enhance productivity and client experience, with nearly 80% of consumer households now fully digitally engaged.

Bank of America Financial Statement Overview

Summary
Bank of America shows strong financial health with robust revenue and net profit margins. However, the balance sheet indicates significant leverage, and cash flow volatility remains a concern despite positive free cash flow.
Income Statement
85
Very Positive
Bank of America has demonstrated strong revenue growth with a TTM revenue increase from the previous year, indicating robust performance in its core banking operations. The net profit margin of 27.32% in the TTM is strong, reflecting efficient cost management and profitability. However, the declining EBITDA margin from 29.21% in 2023 to 22.64% in the TTM suggests potential cost pressures or changes in operating efficiency.
Balance Sheet
72
Positive
The balance sheet reflects a high debt-to-equity ratio, increasing from 2.04 in 2023 to 1.17 in the TTM, indicating significant leverage. Despite this, the equity ratio remains stable at around 8.95%, suggesting a balanced approach to capital structure. The return on equity is strong at 9.42% in the TTM, showcasing effective utilization of shareholder funds, but the increasing leverage poses potential risks.
Cash Flow
65
Positive
The TTM cash flow indicates a positive turnaround with a free cash flow of $6.73 billion, contrasting with negative figures in prior years. The operating cash flow to net income ratio is 0.24, reflecting moderate cash conversion efficiency. However, the fluctuations in cash flow highlight potential volatility in cash management and investment activities.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue192.43B171.91B115.05B93.85B93.75B
Gross Profit96.07B94.19B92.41B93.71B74.21B
EBITDA31.44B30.40B32.95B35.87B20.84B
Net Income27.13B26.52B27.53B31.98B17.89B
Balance Sheet
Total Assets3.26T3.18T3.05T3.17T2.82T
Cash, Cash Equivalents and Short-Term Investments642.92B608.07B458.25B654.54B621.50B
Total Debt658.43B618.19B498.55B496.20B452.58B
Total Liabilities2.97T2.89T2.78T2.90T2.55T
Stockholders Equity295.56B291.65B273.20B270.07B272.92B
Cash Flow
Free Cash Flow-8.80B44.98B-6.33B-7.19B37.99B
Operating Cash Flow-8.80B44.98B-6.33B-7.19B37.99B
Investing Cash Flow-90.69B-35.39B-2.53B-313.29B-177.66B
Financing Cash Flow60.37B93.34B-106.04B291.65B355.82B

Bank of America Technical Analysis

Technical Analysis Sentiment
Positive
Last Price50.74
Price Trends
50DMA
47.54
Positive
100DMA
44.58
Positive
200DMA
44.36
Positive
Market Momentum
MACD
0.98
Negative
RSI
72.23
Negative
STOCH
94.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BAC, the sentiment is Positive. The current price of 50.74 is above the 20-day moving average (MA) of 47.84, above the 50-day MA of 47.54, and above the 200-day MA of 44.36, indicating a bullish trend. The MACD of 0.98 indicates Negative momentum. The RSI at 72.23 is Negative, neither overbought nor oversold. The STOCH value of 94.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BAC.

Bank of America Risk Analysis

Bank of America disclosed 30 risk factors in its most recent earnings report. Bank of America reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Bank of America Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
$218.15B12.7810.69%5.09%-2.96%-13.66%
79
Outperform
$375.83B14.869.46%2.05%4.95%20.49%
77
Outperform
$828.83B15.4716.13%1.76%4.00%8.73%
77
Outperform
$225.60B16.4212.78%1.74%3.53%45.85%
77
Outperform
$263.26B14.0911.51%2.01%0.37%19.89%
73
Outperform
$177.78B14.286.64%2.36%0.52%89.25%
68
Neutral
$17.88B11.6810.28%3.72%9.78%1.27%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
BAC
Bank of America
50.74
11.01
27.71%
C
Citigroup
96.57
36.94
61.95%
HSBC
HSBC Holdings
64.47
23.47
57.24%
JPM
JPMorgan Chase
301.42
85.96
39.90%
WFC
Wells Fargo
82.18
25.08
43.92%
GS
Goldman Sachs Group
745.25
267.54
56.00%

Bank of America Corporate Events

Private Placements and FinancingRegulatory Filings and Compliance
Bank of America Issues Series UU Preferred Stock
Neutral
Jul 24, 2025

On July 24, 2025, Bank of America Corporation issued 100,000 shares of Series UU Preferred Stock and filed a Certificate of Designations to amend its Restated Certificate of Incorporation, detailing the terms of the 6.250% Fixed-Rate Reset Non-Cumulative Preferred Stock. Additionally, the corporation sold 2,500,000 Depositary Shares, each representing a 1/25th interest in a share of the Series UU Preferred Stock, as part of an offering described in their prospectus, impacting their capital structure and shareholder offerings.

The most recent analyst rating on (BAC) stock is a Hold with a $39.00 price target. To see the full list of analyst forecasts on Bank of America stock, see the BAC Stock Forecast page.

Stock BuybackDividends
Bank of America Announces $40 Billion Stock Buyback
Positive
Jul 23, 2025

On July 23, 2025, Bank of America announced that its Board of Directors authorized a new $40 billion common stock repurchase program, effective August 1, 2025, replacing the previous program set to expire on the same date. This move reflects the company’s commitment to returning excess capital to shareholders while maintaining regulatory capital levels. Additionally, the Board declared an increase in the regular quarterly cash dividend on common stock to $0.28 per share, payable on September 26, 2025, and maintained the dividend on its 7% Cumulative Redeemable Preferred Stock, Series B at $1.75 per share, payable on October 24, 2025.

The most recent analyst rating on (BAC) stock is a Hold with a $39.00 price target. To see the full list of analyst forecasts on Bank of America stock, see the BAC Stock Forecast page.

Financial Disclosures
Bank of America to Discuss Q2 Financial Results
Positive
Jul 16, 2025

On July 16, 2025, Bank of America will hold an investor conference call to discuss its second-quarter financial results, which showed a net income of $7.1 billion and a 4% increase in revenue to $26.5 billion compared to the previous year. The company reported growth in net interest income, sales and trading revenue, and asset management fees, despite a decline in investment banking fees. The bank’s balance sheet remains strong, with continued growth in deposits and loans, and a significant return of capital to shareholders, indicating robust financial health and a positive outlook for stakeholders.

The most recent analyst rating on (BAC) stock is a Hold with a $39.00 price target. To see the full list of analyst forecasts on Bank of America stock, see the BAC Stock Forecast page.

DividendsBusiness Operations and Strategy
Bank of America Plans Dividend Increase Post-Fed Review
Positive
Jul 1, 2025

On July 1, 2025, Bank of America announced plans to increase its quarterly common stock dividend from $0.26 to $0.28 per share, subject to board approval, starting in the third quarter of 2025. The announcement followed the results of the Federal Reserve’s 2025 Comprehensive Capital Analysis and Review, which showed an improvement in the bank’s stress capital buffer and CET1 minimum requirement. These changes reflect a stronger capital position, potentially impacting the bank’s operations and stakeholder interests positively.

The most recent analyst rating on (BAC) stock is a Buy with a $50.00 price target. To see the full list of analyst forecasts on Bank of America stock, see the BAC Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025