Bank of America: The Market Is Fearful Again – Be Greedy Now


  • BAC has fallen steeply since we downgraded it, as it underperformed the S&P 500 significantly.
  • Is the selloff appropriate? At its recent highs, yes, because there was too much optimism over its NII growth that’s likely to level off in 2023.
  • Hence, the market has likely focused on whether BAC’s current valuation is appropriate for a recession.
  • But, investors need to ask whether the market has priced in a significant recession?
  • We explain why after the recent selloff, we are more constructive over its recovery.

Bank of America Plaza


BAC: Fell Nearly 15% Since We Downgraded

Bank of America Corporation or BofA (NYSE:BAC) stock has collapsed nearly 15% since we downgraded it to a Hold in our previous article, citing concerns over its valuation and

S&P 500 Diversified Banks net earnings revisions %

S&P 500 Diversified Banks net earnings revisions % (Yardeni Research, Refinitiv)

BofA Net interest income change % and non-interest income change %

BofA Net interest income change % and non-interest income change % (Company filings)

BAC price chart (weekly)

BAC price chart (weekly) (TradingView)

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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