When it comes to the red-hot financial sectors, Bank of America Corp (NYSE:BAC) is at the top of nearly every analyst’s list. And for good reason.
While global banking giants like Citigroup Inc (NYSE:C) and JPMorgan Chase & Co. (NYSE:JPM) are also benefiting considerably from the new higher-rates/lower-regulations environment of the Trump administration, BofA has a considerable edge when it comes to stateside investing. As such, BAC stock is the place to be when it comes to banking on the financial sector.
And we’ll get a peek at just how well Bank of America is performing in a just under a month when the company steps into the earnings confessional. Bank of America has yet to set an official earnings release date for its first-quarter report, but estimates put the date near April 14.
What to Expect From BAC Stock Earnings
Currently, Wall Street is expecting strong growth from Bank of America, with earnings seen rising 25% from 28 cents per share last year to 35 cents per share in the current quarter. Revenue, meanwhile, is expected to rise 9.4% year-over-year to $21.58 billion.
Expectations are understandably high for BAC stock, given the hype surrounding the Fed’s interest rate hikes and Trump’s “America First” policies. This enthusiasm is solidly reflected in Wall Street’s take on BAC stock.
For instance, according to Thomson/First Call data, 26 of the 33 analysts following BAC rate the shares a “buy” or better, with nary a “sell” rating to be found. There is room for improvement, however, as the 12-month price target of $24.94 represents a discount to BAC stock’s close on Thursday. Earnings-driven price-target increases could be just what BofA needs to extend its current rally.
Click to Enlarge In the options pits, BAC stock options traders remain optimistic on the equity’s prospects. Currently, the April put/call open interest ratio checks in at 0.51, with calls nearly doubling puts among those options potentially most affected by Bank of America’s quarterly report.
Overall, April implieds are pricing in a potential post-earnings move of about 5.4% for BAC stock. This places the upper bound at $26.59, while the lower bound lies at $23.85.
Technically, BAC stock is trading in territory not seen since early 2008, but resistance could emerge near $26 as the shares move higher. On the downside, support should hold firm near $24.50, with a potential short-term floor near $23.50 following a possible sell-on-the-news profit-taking event.