Bank of America Continues Its Crazy Bull Run

by Alyssa Oursler | August 1, 2013 3:05 pm

There’s no other way to say it: Bank of America (BAC[1]) is on fire.

The entire financials sector has been killing it this year, with the Financial SPDR (XLF[2]) boasting year-to-date gains that dwarf the broader market by 8 percentage points.

But lately, Bank of America has sprinted ahead of its rivals.

While the XLF, JPMorgan (JPM[3]) and Wells Fargo (WFC[4]) have each added around 7% during the past four weeks, Bank of America has more than doubled that run with a 16% climb — the bulk of which came in the lead-up to its earnings report. BAC has tacked on another 2%-plus today, making it the second-best Dow Jones Industrial Average performer behind American Express (AXP[5]).

Such strong continued momentum has made BAC a doubler in the past 52 weeks, and technically speaking, its higher highs and higher lows provide some optimism going forward.

But despite its climb — and headlines saying the stock has gotten expensive[6] — BAC still is trading at a 28% discount to book. Plus, Bank of America is expected to grow earnings per share by 18% annually for the next decade, yet is trading at just 11 times next year’s earnings.

Mouth-watering valuations are common throughout the sector, though — just one of seven reasons InvestorPlace Editor Jeff Reeves recently said bank stocks remain a buy[7] in the second half.

Still, with valuation as a common denominator, Bank of America has clearly risen above its peers.

As of this writing, Alyssa Oursler did not hold a position in any of the aforementioned securities.

Source URL: https://investorplace.com/2013/08/bank-of-america-continues-its-crazy-bull-run/

---