Bank of America shares PT raised by Piper Sandler on improved NII outlook

Published 04/06/2024, 14:02
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Tuesday, Piper Sandler adjusted its outlook on Bank of America (NYSE:BAC), raising the price target to $37 from $35 while maintaining an Underweight rating. The revision follows the Bank of America CEO's recent comments, which indicated a potential increase in net interest income (NII) for the fourth quarter of 2024, despite a softer guide for the second quarter.

The analyst noted a shift in investor sentiment towards Bank of America, as the market anticipates a stronger NII inflection than previously expected. This adjustment in NII outlook has prompted Piper Sandler to revise its earnings per share (EPS) estimates for the bank. The firm's 2024 EPS forecast has been increased from $3.24 to $3.32, and the 2025 EPS projection has been raised from $3.30 to $3.47.

The updated price target of $37 is based on the higher 2025 EPS estimate, which represents approximately 11 times the projected 2025 earnings. The analyst's comments reflect a reassessment of Bank of America's financial prospects, considering the new information regarding the expected NII for the latter part of 2024.

The bank's stock price target adjustment comes amid changing dynamics in the banking sector, with net interest income being a critical factor for financial institutions. Bank of America's ability to navigate the interest rate environment and potentially post higher NII in the future has been a focal point for analysts and investors alike.

InvestingPro Insights

Bank of America (NYSE:BAC) has shown notable financial dynamics, with a market capitalization of $311.88 billion and a price-to-earnings (P/E) ratio standing at 13.36 for the last twelve months as of Q1 2024. The bank's performance is also reflected in its price momentum, as it trades near its 52-week high with a price percentage of 99.23% of that peak.

InvestingPro Tips reveal that Bank of America has a strong tradition of maintaining and raising dividends, with a current dividend yield of 2.41% and a dividend growth of 9.09% over the last twelve months as of Q1 2024. Moreover, analysts have recognized Bank of America as a prominent player in the banking industry, predicting the company will remain profitable this year, a sentiment backed by its profitability over the last twelve months.

For those considering a deeper analysis, InvestingPro offers additional insights on Bank of America, which could further inform investment decisions. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking access to a broader range of InvestingPro Tips. Currently, there are 8 additional tips available for Bank of America at https://www.investing.com/pro/BAC, providing a comprehensive view of the company's financial health and market position.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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