Bank of America Earnings Just Good Enough

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Bank of America Corp. (NYSE: BAC) released its third-quarter earnings report before the markets opened on Monday. The company said that it had $0.66 in earnings per share (EPS) and $22.8 billion in revenue, which compares with consensus estimates of $0.62 in EPS and $22.7 billion in revenue. In the same period of last year, the bank said it EPS of had $0.48 on $21.8 billion in revenue.

During the most recent quarter, average loan and lease balances in business segments rose $29 billion, or 3%, to $871 billion. Average deposit balances rose $45 billion, or 4%, to $1.3 trillion.

In terms of its segments, the bank reported as follows:

  • Consumer Banking had revenues of $9.4 billion, with net income increasing 49% to $3.1 billion.
  • Global Wealth and Investment Management had revenues of $4.78 billion, with net income rising 31% to $1.0 billion.
  • Global Banking revenues totaled $4.74 billion, with net income increasing 13% to $2.0 billion.
  • Global Markets posted revenues of $3.84 billion, with net income growing 21% to $912 million.

At the end of the quarter, book value per share was $24.33 and tangible book value per share was $17.23.

Brian Moynihan, board chair and chief executive, commented:

Responsible growth, backed by a solid U.S. economy and a healthy U.S. consumer, combined to deliver the highest quarterly pre-tax earnings in our company’s history. This marks the 15th consecutive quarter of positive operating leverage, driven by continued growth in deposits, client balances in wealth management, solid loan growth, and disciplined expense management. Our strong balance sheet has allowed us to return $19 billion to shareholders so far this year in dividends and share buybacks.

Shares of Bank of America closed Friday at $28.46, with a consensus analyst price target of $34.89 and a 52-week trading range of $25.81 to $33.05. Following the announcement, the stock was up 1% at $28.79 in early trading indications Monday.