Bank of America Corp (NYSE:BAC) looks like a bargain buy right now. But with so much exposure to the U.S. economy, it’s not unreasonable to worry about how the election will affect BAC stock.

Happily, it looks like the answer is “not much.”

Analysts at Keefe, Bruyette and Woods looked at the market response to Election Day going back decades. Indeed, the data set goes all the way back to 1936 for the S&P 500 and 1972 for the Nasdaq. The good news is that the election is nothing to fear and could even be good for BAC stock. KBW notes that fears of Election Day volatility are overblown:

“Election Day is not a market-moving event. With the exception of ’08, SPX rose 0-1% on Election Day. Financials had similar performance, ranging from a 0.4% decline to a 1.6% gain.”

Interestingly, financials actually outperformed in four of the last five elections. However, once the tally has been taken, sector performance is more mixed. From KBW:

“Financials also struggled on the day after Election Day, and underperformed in 4 of the last 5 elections. Financials fell as much as 8.8% on the day after Election Day in ’08, but also gained as much as 1.1% in ’96.”

Financials don’t lead the market by the nose anymore — to say nothing of BAC stock — but the day after is generally a downer for the broader market. KBW again:

“In the last 20 presidential elections, the market declined on the day after Election Day 8 times, but 6 of those declines occurred after the last 8 elections. On the day after Election Day, SPX rose as much as 1.8% in ’80 but fell as much as 5.3% in ’08.”

For BAC Stock Holders: Stay Frosty

The best news for value investors is that they can ignore all this noise — as they always should. Valuation returns to the mean over time, it’s just that we’re usually talking about a lot of it. That more than extends to Bank of America stock.

And valuation is the key to the investment thesis on BofA. Overly beaten-down stocks are always a good bet if you’re a value investor. That description aptly describes BAC stock.

Just be forewarned: This opportunity won’t last forever.

Don’t look now, but Bank of America stock is up more than 13% since the market sold off sharply at the end of July. That beats the S&P 500 by about 4 percentage points.

True, the market offers a higher dividend yield than Bank of America stock, but not by leaps and bounds. Dividends from the benchmark index deliver a yield of 2.16% at current levels. BAC’s dividend yields 1.8%. On the other hand, Bank of America has a chance to goose its dividend in 2017 after it passes its annual stress test. The S&P 500’s overall dividend might go up a tick, but on a percentage basis, BofA almost assuredly will outdo whatever the index does.

This Opportunity Won’t Last Forever

Between price appreciation and dividends, BAC stock could be a nice little total return engine for patient investors.

They just have to buy while the stock is still cheap.

Banks often trade at a slight discount to their price-to-book multiples. Supposedly that’s because they make some risky bets. But regulation has greatly reduced certain risks in the financial sector, yet BofA’s P/B is stuck at 0.69. By comparison, scandal-scarred Wells Fargo & Co (NYSE:WFC) still has a premium P/B of 1.27. JPMorgan Chase & Co. (NYSE:JPM) at 1.09 is what a reasonably valued bank stock looks like.

For what it’s worth, BAC stock also trades at discounts to its own average price-to-earnings ratios. The forward P/E of 10.8 is about 5% below its five-year mean of 11.3, according to data from Thomson Reuters Stock Reports. On a trailing earnings basis, the stock trades at a whopping 58% discount to its average.

Understandably, weakness in the oil patch, ultra-low interest rates are weighing on sentiment. That won’t last forever. Oil is cyclical. It may not feel like it, but at some point rates will go up.

Cost cuts, the return of bond trading and the stabilization of oil prices aren’t getting enough credit from the market. Wait long enough, and multiple expansion will do some heavy lifting on BAC stock no matter what happens on Election Day.

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