Bank of America (BAC) AI Stock Analysis

• Market Cap: $374.72B
• Dividend Yield: 2.06%
• Average Volume (3M): 33.86M
• Price to Earnings (P/E): 14.8
• Beta (1Y): 1.23
• Revenue Growth: 4.95%
• EPS Growth: 20.49%
• Country: US
• Employees: 213,000
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Diversified
• EPS (TTM): 0.89
• Shares Outstanding: 7,406,947,300
• 10 Day Avg. Volume: 37,067,369
• 30 Day Avg. Volume: 33,857,059
• PEG Ratio: 2.59
• Price to Book (P/B): 1.15
• Price to Sales (P/S): 1.77
• P/FCF Ratio: -38.63
• Enterprise Value/Market Cap: 3.01
• Enterprise Value/Revenue: 5.96
• Enterprise Value/Gross Profit: 11.46
• Enterprise Value/Ebitda: 34.74
• 1Y Price Target: $53.69
• Price Target Upside: 4.46% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 19

• Rating: 74 Outperform
• Price Target: $55.00 ▲(7.00% Upside)

Bank of America's strong earnings growth and strategic capital returns are key strengths, supported by positive technical indicators. However, challenges in cash flow management and commercial real estate pose risks. The stock's moderate valuation and dividend yield add to its appeal.

Positive Factors

Net Interest Income Growth

Sustained growth in net interest income indicates strong core banking operations and effective interest rate management, which are crucial for long-term profitability.

AI and Technology Advancements

Investments in AI and technology enhance operational efficiency and customer experience, providing a competitive edge in the evolving financial services landscape.

Capital Return to Shareholders

Significant capital returns through buybacks and dividends reflect strong financial health and a commitment to shareholder value, supporting long-term investor confidence.

Negative Factors

Negative Cash Flows

Negative cash flows highlight potential liquidity issues, which could constrain the bank's ability to invest in growth opportunities and meet financial obligations.

Commercial Real Estate Challenges

Challenges in commercial real estate could lead to increased credit risk and impact profitability, posing a long-term threat to financial stability.

Regulatory and Compliance Costs

Rising regulatory costs can erode profit margins and require ongoing investment in compliance, affecting the bank's operational efficiency and financial performance.

Bank of America Business Overview & Revenue Model

Company Description

Bank 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 Money

Bank 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 Financial Statement Overview

Summary

Bank of America shows strong revenue growth and profitability with a net profit margin of 27.32%. However, the declining EBITDA margin and high leverage indicate potential risks in cost management and financial stability.

Income Statement

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

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

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.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	189.49B	192.43B	171.91B	115.05B	93.85B	93.75B
Gross Profit	98.45B	96.07B	94.19B	92.41B	93.71B	74.21B
EBITDA	32.49B	31.44B	30.40B	32.95B	35.87B	20.84B
Net Income	28.07B	27.13B	26.52B	27.53B	31.98B	17.89B
Balance Sheet
Total Assets	3.44T	3.26T	3.18T	3.05T	3.17T	2.82T
Cash, Cash Equivalents and Short-Term Investments	653.42B	642.92B	608.07B	458.25B	654.54B	621.50B
Total Debt	760.77B	658.43B	618.19B	498.55B	496.20B	452.58B
Total Liabilities	3.14T	2.97T	2.89T	2.78T	2.90T	2.55T
Stockholders Equity	299.60B	295.56B	291.65B	273.20B	270.07B	272.92B
Cash Flow
Free Cash Flow	-22.68B	-8.80B	44.98B	-6.33B	-7.19B	37.99B
Operating Cash Flow	-22.68B	-8.80B	44.98B	-6.33B	-7.19B	37.99B
Investing Cash Flow	-163.78B	-90.69B	-35.39B	-2.53B	-313.29B	-177.66B
Financing Cash Flow	127.90B	60.37B	93.34B	-106.04B	291.65B	355.82B

Bank of America Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 51.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 51.4 is above the 20-day moving average (MA) of 49.96, above the 50-day MA of 48.04, and above the 200-day MA of 44.41, indicating a bullish trend. The MACD of 0.88 indicates Negative momentum. The RSI at 68.98 is Neutral, neither overbought nor oversold. The STOCH value of 83.28 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BAC.

Bank of America Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSBC	81 Outperform	238.97B	13.67	12.96%	4.71%	-2.96%	-13.66%
GS	76 Outperform	240.43B	17.31	12.54%	1.64%	3.53%	45.85%
BAC	74 Outperform	$374.72B	14.82	9.46%	2.06%	4.95%	20.49%
JPM	74 Outperform	857.24B	15.86	15.84%	1.70%	4.00%	8.73%
WFC	72 Outperform	264.22B	13.96	11.36%	2.00%	0.37%	19.89%
C	70 Outperform	187.33B	14.88	6.65%	2.24%	0.52%	89.25%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Bank of America Corporate Events

Bank of America Issues Series UU Preferred Stock

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.

Bank of America Announces $40 Billion Stock Buyback

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.

Bank of America to Discuss Q2 Financial Results

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.

Bank of America Plans Dividend Increase Post-Fed Review

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.