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Bank of America (BAC) Stock Sinks As Market Gains: What You Should Know

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Bank of America (BAC - Free Report) closed the most recent trading day at $36.15, moving -0.11% from the previous trading session. This move lagged the S&P 500's daily gain of 0.31%. At the same time, the Dow added 0.05%, and the tech-heavy Nasdaq gained 0.14%.

Heading into today, shares of the nation's second-largest bank had lost 3.36% over the past month, lagging the Finance sector's loss of 0.4% and the S&P 500's loss of 1.38% in that time.

Bank of America will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.81, down 21.36% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $23.21 billion, up 8.13% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.35 per share and revenue of $94.58 billion, which would represent changes of -6.16% and +6.14%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Bank of America. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.39% higher. Bank of America is currently a Zacks Rank #3 (Hold).

Digging into valuation, Bank of America currently has a Forward P/E ratio of 10.81. For comparison, its industry has an average Forward P/E of 10.83, which means Bank of America is trading at a discount to the group.

Also, we should mention that BAC has a PEG ratio of 1.54. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Banks - Major Regional was holding an average PEG ratio of 1.54 at yesterday's closing price.

The Banks - Major Regional industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 106, which puts it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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