JPM - Bank of America Q1 Preview: Higher For Longer Is Good
2024-04-05 14:45:22 ET
Summary
- Bank of America is expected to report strong earnings and demonstrate financial stability in its upcoming earnings report.
- Concerns about lower interest rates and deposit flight are unfounded, as the bank has a strong deposit base and potential for higher-than-expected net interest income.
- The bank is undervalued and has the potential for approximately 20% upside in shares based on historical metrics and the upcoming earnings report.
Investment Thesis
Heading into their earnings report pre-market on April 16th, I believe Bank of America Corporation ( BAC ) is well positioned to report strong earnings and set an optimistic tone heading into the rest of 2024. The financial giant, one of the "too big to fail" banks, is known for its extensive retail branch network and diversified services. With a solid CET1 capital of $195 billion as of the Q4 presentation indicating strong financial stability, I believe the upcoming earnings will shed a favorable light on Bank of America's ability to sustain strong NII revenue with interest rates at or near their peak, and better than what appears capital strength amidst some market concerns about the banks future with peaking rates....
Bank of America Q1 Preview: Higher For Longer Is Good