JFrog stock rises as Cantor Fitzgerald maintains Overweight rating after strong Q2
On Friday, Baird analyst David George upgraded Bank of America stock, listed on the New York Stock Exchange under the ticker (NYSE:BAC), from Neutral to Outperform. Alongside the rating upgrade, the analyst also raised the price target to $50.00 from the previous $45.00. According to InvestingPro data, BAC currently trades at $41.46, with analysis suggesting the stock may be undervalued. As one of America’s largest banks with a market capitalization of $315.29 billion, BAC offers investors significant exposure to the financial sector.
The upgrade reflects Baird’s increased confidence in Bank of America’s financial prospects. George highlighted the strength of the bank’s deposit franchise, its consistent execution, relatively low credit risk, and robust markets businesses as key factors for the positive outlook. The analyst expressed belief that the bank’s valuation now makes sense with the stock trading in the low $40s.
Bank of America’s current trading at 1.16 times book value and a P/E ratio of 13.17x, while Baird estimates a normalized earnings per share (EPS) of $4.80. This valuation, according to George, offers an attractive entry point for investors. InvestingPro analysis reveals additional valuable metrics and insights, with 12 more exclusive ProTips available to subscribers.
The report also noted that Bank of America is currently under-earning due to a below-normal net interest margin (NIM), but this is expected to provide a strong tailwind over the coming years. Additionally, the bank is seen as well-positioned to return capital to shareholders thanks to its healthy pre-provision net revenue (PPNR) profitability and modest balance sheet growth.
In summary, Baird’s analysis suggests that the fair value for Bank of America is in the $50 range, offering a more optimistic perspective on the bank’s future performance. The bank has maintained dividend payments for 55 consecutive years, with a current dividend yield of 2.52% and an impressive 11-year streak of dividend increases. For comprehensive analysis including Fair Value estimates and detailed financial health scores, investors can access the full BAC Research Report on InvestingPro.
In other recent news, Citadel Securities reported a record-breaking trading revenue of $9.7 billion for the full year, marking a 55% increase from the previous year. This achievement places Citadel Securities ahead of several major European banks in trading revenue. Meanwhile, the U.S. Consumer Financial Protection Bureau decided to drop a lawsuit against JPMorgan Chase (NYSE:JPM), Bank of America, and Wells Fargo (NYSE:WFC) related to the handling of the payment service Zelle. Additionally, Bank of America announced the appointment of Johnbull Okpara as the new Chief Accounting Officer, effective March 1, 2025, as part of a planned leadership transition.
In another development, Bank of America CEO Brian Moynihan projected that the Federal Reserve would maintain current interest rates through this year and the next, while advocating for simpler regulations. Furthermore, major banks, including Morgan Stanley (NYSE:MS) and Bank of America, sold a significant portion of the $13 billion debt associated with Elon Musk’s 2022 acquisition of Twitter, now known as X. The recent secondary sale involved $4.74 billion worth of secured loans, with the banks nearly offloading the entire debt. This sale attracted interest from large fund managers, partly due to potential revenue growth for X and its connection to Musk’s artificial intelligence startup, xAI.
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