Latest news with #AlastairBorthwick
Business Insider
16 hours ago
- Business
- Business Insider
Deregulation Price Catalyst Spurs Bank of America Stock (BAC) Bulls
Bank of America (BAC) is standing at the edge of a transformative moment. A wave of deregulation is about to sweep through the financial sector, promising to loosen the tight capital and compliance rules that have weighed on banks for years. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter For BAC, this could mean more cash to lend, fatter investment banking fees, and juicier shareholder returns. While the stock has climbed to new 52-week highs, it is still priced as a value play. Therefore, I'm Bullish on BAC stock. Unleashing Lending Power Through Deregulation Momentum is building around deregulation, with major banks like Bank of America (BAC) poised to benefit. Potential rollbacks to Basel III capital requirements could unlock billions by lowering reserve thresholds, giving BAC more room to lend. In Q1, the bank reported $14.44 billion in net interest income on its $2 trillion deposit base, and analysts suggest that a looser regulatory environment could increase this figure by 6–7% this year, meaningfully boosting earnings. At the same time, compliance costs—long a drag on profitability—may finally ease. BAC's recent removal from a consumer watchdog's oversight hints at a broader regulatory reprieve. If oversight continues to soften, the bank could not only lower expenses but also redirect capital toward growth areas like small business loans and mortgages. Capital Markets Ready to Roar Bank of America's investment banking and trading divisions stand to gain significantly from a potential wave of deregulation. Looser rules tend to drive M&A activity, IPOs, and market volatility—ideal conditions for BAC's Global Markets unit. In Q1, equities trading revenue surged 17% to a record $2.2 billion, and fixed income climbed 5% to $3.5 billion, as Main Street Data shows. While investment banking fees dipped 3% to $1.5 billion, reflecting a broader slowdown in U.S. M&A, CEO Alastair Borthwick pointed to a strengthening deal pipeline. A more business-friendly climate under the Trump administration could accelerate this recovery. Meanwhile, the ongoing market resilience, even amid geopolitical tensions, signals investor optimism regarding pro-growth policies. For BAC, that translates into more opportunities to capitalize on volatility. Should deregulation spark renewed corporate deal flow—or support BAC's push into digital assets, such as its proposed USD-backed stablecoin—the bank could unlock new revenue streams and deepen its market advantage. Shareholder Returns Set to Shine Deregulation could be a goldmine for BAC's shareholders as well. With less capital tied up, BAC can ramp up buybacks and dividends. In Q1, earnings rose 11% to $7.4 billion, backed by a robust Common Equity Tier 1 ratio of 11.8%, well above the 10.7% minimum. This gives BAC plenty of room to return capital if these ratio requirements go down. Today, it has a $0.26 quarterly dividend yield of 2.25%, which the company has grown for 11 straight years, with 16 years of dividend growth to boot, according to TipRanks data. Meanwhile, projected buybacks for the year reach $18 billion, screaming confidence. In fact, BAC trades at a buyback yield of 4.3% on recent repurchases, which, along with the dividend, form a blended yield of 6.5%. Not bad for a company expected to see notable growth in the near term. In the meantime, the payout ratio stands at just 28.4% this year's consensus EPS estimate of $3.66, so an acceleration in the rate of dividend hikes is indeed possible. A Bargain Hiding in Plain Sight At today's share price, BAC stock is trading at its 52-week highs, but in my view, it's still a steal. Consensus EPS estimates project 14% growth to $3.66 in 2025, followed by an acceleration to 17% growth to $4.25 in 2026. Yet, BAC trades at just 12.7x 2025 EPS, which is significantly below that of some of its competitors. For context, JPMorgan's (JPM) 15x and Wells Fargo's 13.5x multiples are higher, despite BAC outpacing their growth forecasts. Tariff fears and potential rate cuts (which could possibly shave $3.3 billion off net interest income if rates drop 100 basis points) could spook investors. However, BAC's strong wealth management inflows and trading gains suggest that the impact may not be as harsh on a consolidated basis. What is the Price Target for Bank of America? Wall Street's stance on Bank of America stock is quite bullish. As things stand, BAC carries a Strong Buy consensus based on 18 Buy and two Hold ratings in the past three months. BAC's average 12-month price target of $49.50 implies a potential upside of approximately 6%, suggesting that many analysts believe the stock could continue to rise despite trading just below 52-week highs. Deregulation Tailwinds Could Power Next Leg of BAC Growth Bank of America is approaching a pivotal moment, with potential deregulation poised to unlock fresh growth opportunities. Positioned to boost lending, energize its capital markets division, and enhance shareholder returns, BAC looks compelling—especially at just 12.7x earnings and with EPS expected to rise 14–17% in the near term. While macroeconomic risks, such as trade tensions and interest rate shifts, remain, the bank's strong balance sheet and diversified operations provide a solid foundation for continued performance and investor upside.
Yahoo
15-04-2025
- Business
- Yahoo
Bank of America Reports First Quarter 2025 Financial Results
CHARLOTTE, N.C., April 15, 2025 /PRNewswire/ -- Bank of America reported its first quarter 2025 financial results today. The news release, supplemental filing and investor presentation can be accessed at Bank of America's Investor Relations website at Investor Conference Call informationChief Executive Officer Brian Moynihan and Chief Financial Officer Alastair Borthwick will discuss the financial results in an investor conference call at 8:30 a.m. ET today. For a listen-only connection to the conference call, dial 1.877.200.4456 (U.S.) or 1.785.424.1732 (international), and the conference ID is 79795. Please dial in 10 minutes prior to the start of the call. Investors can also listen to live audio of the conference call and view the presentation slides by visiting the "Events and Presentations" section of the company's Investor Relations website. Replay information for Investor Conference CallInvestors can access replays of the investor conference call by visiting the Investor Relations website or by calling 1.800.934.4850 (U.S.) or 1.402.220.1178 (international) from noon on April 15 through 11:59 p.m. ET on April 25. Bank of America Bank of America is one of the world's leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 69 million consumer and small business clients with 3,700 retail financial centers, approximately 15,000 ATMs (automated teller machines) and award-winning digital banking with approximately 58 million verified digital users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 4 million small business households through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and more than 35 countries. Bank of America Corporation stock is listed on the New York Stock Exchange (NYSE: BAC). Investors May Contact: Lee McEntire, Bank of AmericaPhone: Jonathan Blum, Bank of America (Fixed Income)Phone: Reporters May Contact: Jocelyn Seidenfeld, Bank of AmericaPhone: View original content to download multimedia: SOURCE Bank of America Corporation Sign in to access your portfolio
Yahoo
15-04-2025
- Business
- Yahoo
Bank of America Reports First Quarter 2025 Financial Results
CHARLOTTE, N.C., April 15, 2025 /CNW/ -- Bank of America reported its first quarter 2025 financial results today. The news release, supplemental filing and investor presentation can be accessed at Bank of America's Investor Relations website at Investor Conference Call informationChief Executive Officer Brian Moynihan and Chief Financial Officer Alastair Borthwick will discuss the financial results in an investor conference call at 8:30 a.m. ET today. For a listen-only connection to the conference call, dial 1.877.200.4456 (U.S.) or 1.785.424.1732 (international), and the conference ID is 79795. Please dial in 10 minutes prior to the start of the call. Investors can also listen to live audio of the conference call and view the presentation slides by visiting the "Events and Presentations" section of the company's Investor Relations website. Replay information for Investor Conference CallInvestors can access replays of the investor conference call by visiting the Investor Relations website or by calling 1.800.934.4850 (U.S.) or 1.402.220.1178 (international) from noon on April 15 through 11:59 p.m. ET on April 25. Bank of America Bank of America is one of the world's leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 69 million consumer and small business clients with 3,700 retail financial centers, approximately 15,000 ATMs (automated teller machines) and award-winning digital banking with approximately 58 million verified digital users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 4 million small business households through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and more than 35 countries. Bank of America Corporation stock is listed on the New York Stock Exchange (NYSE: BAC). Investors May Contact: Lee McEntire, Bank of AmericaPhone: Jonathan Blum, Bank of America (Fixed Income)Phone: Reporters May Contact: Jocelyn Seidenfeld, Bank of AmericaPhone: View original content to download multimedia: SOURCE Bank of America Corporation View original content to download multimedia: Sign in to access your portfolio
