Bank of America (BAC) closed at $33.07 in the latest trading session, marking a +1.66% move from the prior day. The stock outpaced the S&P 500’s daily loss of 0.66%. At the same time, the Dow lost 0.29%, and the tech-heavy Nasdaq lost 1.25%.
Heading into today, shares of the nation’s second-largest bank had gained 11.75% over the past month, outpacing the Finance sector’s gain of 5.02% and the S&P 500’s gain of 3.42% in that time.
BAC will be looking to display strength as it nears its next earnings release, which is expected to be January 19, 2021. On that day, BAC is projected to report earnings of $0.54 per share, which would represent a year-over-year decline of 27.03%. Our most recent consensus estimate is calling for quarterly revenue of $20.26 billion, down 9.35% from the year-ago period.
Investors might also notice recent changes to analyst estimates for BAC. These revisions help to show the ever-changing nature of near-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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 7.17% higher. BAC is currently a Zacks Rank #3 (Hold).
Investors should also note BAC’s current valuation metrics, including its Forward P/E ratio of 14.84. For comparison, its industry has an average Forward P/E of 13.83, which means BAC is trading at a premium to the group.
Meanwhile, BAC’s PEG ratio is currently 2.12. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. Banks – Major Regional stocks are, on average, holding a PEG ratio of 2.12 based on yesterday’s closing prices.
The Banks – Major Regional industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 83, which puts it in the top 33% 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.
To follow BAC in the coming trading sessions, be sure to utilize Zacks.com.
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