Banking, finance, and taxes

What to Look For in Bank of America Earnings

Chris Lange

Published: October 12, 2017 1:35 pm

Last Updated: January 12, 2020 7:14 am

Bank of America Corp. (NYSE: BAC) is set to report its most recent quarterly results before the markets open on Friday. Prior to the release of this report Citigroup and JPMorgan already posted results, but did not make any real waves. It’s left up to Bank of America and Wells Fargo on Friday morning to see if anything will move the needle.

Out of the major money center banks, Bank of America is the second best performer in 2017, behind Citigroup with its stock up 17% year to date. However, over the past 52 weeks Bank of America is the top dog, with its stock up 60%.

In terms of the upcoming earnings, the consensus estimates from Thomson Reuters call for $0.45 in earnings per share (EPS) and $21.93 billion in revenue. The third-quarter of last year reportedly had EPS of $0.41 and $21.86 in revenue.

In its most recent quarter, book value per share rose 5% year over year to $24.88, while tangible book value per share increased 6% to $17.78. The stock still trades above book value, but it is closer than most of the other major institutions, with the exception of Citigroup, which trades below book value.

Management also said in the previous earnings report that it has a plan to return $17 billion in capital during the next four quarters, including a 60% increase in the quarterly common dividend.

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Ahead of the earnings report, a few analysts issued calls on Bank of America:

• Credit Suisse has an Outperform rating.
• Citigroup has a Neutral rating with a $27 price target.
• Robert Baird has a Hold rating with a $24 price target.
• Deutsche Bank has a Hold rating and a $25 price target.
• Jefferies has a Buy rating with a $28 price target.
• Wells Fargo has an Outperform rating with a $30 target.

Shares of Bank of America were last seen down about 1% on the day to $25.57, with a consensus analyst price target of $27.50 and a 52-week range of $15.60 to $26.30.