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Bank of America vs. Truist: Which Bank Offers Better Upside in 2026?
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Key Takeaways
BAC is viewed as well-positioned for 2026 upside due to scale, diversification and earnings growth.
BAC expects NII growth in the upper end of 6-8% in 2026, supported by loans and stabilizing funding costs.
TFC offers a discounted valuation, but higher expenses may limit near-term operating leverage.
Bank of America (BAC - Free Report) and Truist Financial Corporation (TFC - Free Report) operate in the same banking landscape but offer investors very different risk-reward profiles. Bank of America stands out for its global scale, diversified revenue streams and strong deposit franchise, positioning it to benefit from improving capital markets activity, easing funding pressures and a more favorable rate backdrop.
Truist, alternatively, offers the appeal of a regional bank recovery story, with the upside tied to cost discipline, balance-sheet repositioning and margin stabilization.
Both banks are investing heavily in technology, data analytics and artificial intelligence (AI) to improve efficiency and deepen customer relationships. However, they differ meaningfully in size, business mix and diversification.
With consumer spending remaining resilient, loan demand improving, investment banking (IB) activity recovering and AI-driven productivity tools gaining traction, the key question is: which stock among BAC and TFC is better-positioned to capitalize on these trends and deliver stronger upside in 2026?
The Case for BAC
Bank of America, the second-largest bank in the United States, is well-positioned for near-term improvement in net interest income (NII), supported by loan growth, fixed-rate asset repricing and stabilizing funding costs. From 2020 to 2025, the company’s NII grew at a compound annual growth rate (CAGR) of 6.7%, with the momentum continuing in the first quarter of 2026. Management expects fully taxable-equivalent NII to increase in the upper end of the 6-8% range this year.
BAC’s IB business has shown a meaningful recovery after a weak 2022 and 2023, when IB fees in the Global Banking segment declined 45.7% and 2.4%, respectively. The business rebounded in 2024 and 2025, with fees rising 31.4% and 8.4%, respectively. With global merger and acquisition activity improving and the company maintaining a healthy deal pipeline, BAC is expected to continue benefiting from solid growth in IB fees.
The company’s trading business has also improved since 2022. In the first quarter of 2026, sales and trading revenues, excluding net DVA, rose 12% year over year. However, given the volatile nature of capital markets, trading revenues can fluctuate significantly and may create earnings variability even when overall performance remains favorable.
Bank of America continues to focus on organic growth by expanding both physical and digital presence. This strategy is aimed at strengthening customer relationships, entering new markets and supporting long-term NII growth. By 2027, the company plans to open more than 150 financial centers. At the same time, the increased adoption of digital tools such as Zelle and its AI-powered assistant Erica is helping BAC boost customer engagement and cross-sell products, including mortgages, auto loans and credit cards.
The Case for TFC
Compared with Bank of America, Truist has a more regionally focused business model and is relatively less exposed to interest rate cycles and capital markets volatility. Since selling its insurance subsidiary in 2024, the company has been working to strengthen its balance sheet, reposition its portfolio and expand more stable sources of non-interest income.
In August 2025, TFC announced a long-term growth plan aimed at deepening its presence in attractive U.S. markets. The plan includes opening 100 new branches, renovating more than 300 existing locations in high-growth cities by 2030 and investing in its business banking ecosystem.
Truist is also focusing on wealth management and IB as key drivers of fee income. While total non-interest income declined in 2022 and 2024 due to large securities losses, non-interest income, excluding those losses, saw a six-year (2019-2025) CAGR of 1.9%. A broader recovery in trading and IB activity could further support fee revenue growth.
On the interest income side, Truist’s NII saw a five-year (2020-2025) CAGR of 1.1%, helped by solid loan demand and higher rates, with the momentum continuing in the first quarter of 2026. For 2026, management expects average loan growth of 3-4% and NII growth of 2-3%, assuming stable policy rates.
However, Truist’s growth strategy comes with cost pressure. As the company expands its branch network, upgrades technology and adds talent to strengthen its commercial banking business, expenses are likely to remain elevated. Management expects GAAP expenses to rise 1.75% in 2026, which could limit near-term operating leverage compared with Bank of America’s scale-driven efficiency.
BAC & TFC: Price Performance, Valuation & Other Comparisons
Over the past three months, TFC and BAC shares have risen 5.2% and 12.4%, respectively. Hence, in terms of price performance, Bank of America has a clear edge over Truist.
3-Month Price Performance
Image Source: Zacks Investment Research
In terms of valuation, Truist is currently trading at a 12-month forward price-to-earnings (P/E) of 10.30X. Bank of America, in contrast, is trading at a 12-month forward P/E of 11.40X.
Therefore, TFC is trading at a discount compared with BAC.
P/E F12M
Image Source: Zacks Investment Research
Bank of America’s return on equity (ROE) of 11.49% is way higher than Truist’s 9.55%. This reflects BAC’s efficient use of shareholder funds in generating profits.
ROE
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for TFC & BAC?
The Zacks Consensus Estimate for BAC's 2026 and 2027 earnings indicates 16.8% and 14.2% year-over-year growth, respectively. In the past week, the company’s earnings estimates for both years have been unchanged.
BAC Estimate Revision Trend
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for TFC’s 2026 and 2027 earnings indicates rallies of 14.4% and 13.3%, respectively. Earnings estimates for both years have been unchanged over the past seven days.
TFC Estimate Revision Trend
Image Source: Zacks Investment Research
BAC or TFC: Which Bank Is Positioned for Better Upside?
Bank of America seems well-positioned to capitalize on the current interest rate environment through its scale, diversified income streams and branch expansion strategy. Its robust earnings growth outlook, superior ROE and impressive capital distribution activities signal financial strength and shareholder value creation. The company’s digital innovations and cross-selling opportunities also provide a long-term competitive advantage.
Truist Financial, though less sensitive to rate shifts, presents relatively modest earnings growth. Its discounted valuation and expansion strategy may appeal to value investors, but overall, Bank of America appears the stronger long-term bet right now.
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Bank of America vs. Truist: Which Bank Offers Better Upside in 2026?
Key Takeaways
Bank of America (BAC - Free Report) and Truist Financial Corporation (TFC - Free Report) operate in the same banking landscape but offer investors very different risk-reward profiles. Bank of America stands out for its global scale, diversified revenue streams and strong deposit franchise, positioning it to benefit from improving capital markets activity, easing funding pressures and a more favorable rate backdrop.
Truist, alternatively, offers the appeal of a regional bank recovery story, with the upside tied to cost discipline, balance-sheet repositioning and margin stabilization.
Both banks are investing heavily in technology, data analytics and artificial intelligence (AI) to improve efficiency and deepen customer relationships. However, they differ meaningfully in size, business mix and diversification.
With consumer spending remaining resilient, loan demand improving, investment banking (IB) activity recovering and AI-driven productivity tools gaining traction, the key question is: which stock among BAC and TFC is better-positioned to capitalize on these trends and deliver stronger upside in 2026?
The Case for BAC
Bank of America, the second-largest bank in the United States, is well-positioned for near-term improvement in net interest income (NII), supported by loan growth, fixed-rate asset repricing and stabilizing funding costs. From 2020 to 2025, the company’s NII grew at a compound annual growth rate (CAGR) of 6.7%, with the momentum continuing in the first quarter of 2026. Management expects fully taxable-equivalent NII to increase in the upper end of the 6-8% range this year.
BAC’s IB business has shown a meaningful recovery after a weak 2022 and 2023, when IB fees in the Global Banking segment declined 45.7% and 2.4%, respectively. The business rebounded in 2024 and 2025, with fees rising 31.4% and 8.4%, respectively. With global merger and acquisition activity improving and the company maintaining a healthy deal pipeline, BAC is expected to continue benefiting from solid growth in IB fees.
The company’s trading business has also improved since 2022. In the first quarter of 2026, sales and trading revenues, excluding net DVA, rose 12% year over year. However, given the volatile nature of capital markets, trading revenues can fluctuate significantly and may create earnings variability even when overall performance remains favorable.
Bank of America continues to focus on organic growth by expanding both physical and digital presence. This strategy is aimed at strengthening customer relationships, entering new markets and supporting long-term NII growth. By 2027, the company plans to open more than 150 financial centers. At the same time, the increased adoption of digital tools such as Zelle and its AI-powered assistant Erica is helping BAC boost customer engagement and cross-sell products, including mortgages, auto loans and credit cards.
The Case for TFC
Compared with Bank of America, Truist has a more regionally focused business model and is relatively less exposed to interest rate cycles and capital markets volatility. Since selling its insurance subsidiary in 2024, the company has been working to strengthen its balance sheet, reposition its portfolio and expand more stable sources of non-interest income.
In August 2025, TFC announced a long-term growth plan aimed at deepening its presence in attractive U.S. markets. The plan includes opening 100 new branches, renovating more than 300 existing locations in high-growth cities by 2030 and investing in its business banking ecosystem.
Truist is also focusing on wealth management and IB as key drivers of fee income. While total non-interest income declined in 2022 and 2024 due to large securities losses, non-interest income, excluding those losses, saw a six-year (2019-2025) CAGR of 1.9%. A broader recovery in trading and IB activity could further support fee revenue growth.
On the interest income side, Truist’s NII saw a five-year (2020-2025) CAGR of 1.1%, helped by solid loan demand and higher rates, with the momentum continuing in the first quarter of 2026. For 2026, management expects average loan growth of 3-4% and NII growth of 2-3%, assuming stable policy rates.
However, Truist’s growth strategy comes with cost pressure. As the company expands its branch network, upgrades technology and adds talent to strengthen its commercial banking business, expenses are likely to remain elevated. Management expects GAAP expenses to rise 1.75% in 2026, which could limit near-term operating leverage compared with Bank of America’s scale-driven efficiency.
BAC & TFC: Price Performance, Valuation & Other Comparisons
Over the past three months, TFC and BAC shares have risen 5.2% and 12.4%, respectively. Hence, in terms of price performance, Bank of America has a clear edge over Truist.
3-Month Price Performance
Image Source: Zacks Investment Research
In terms of valuation, Truist is currently trading at a 12-month forward price-to-earnings (P/E) of 10.30X. Bank of America, in contrast, is trading at a 12-month forward P/E of 11.40X.
Therefore, TFC is trading at a discount compared with BAC.
P/E F12M
Image Source: Zacks Investment Research
Bank of America’s return on equity (ROE) of 11.49% is way higher than Truist’s 9.55%. This reflects BAC’s efficient use of shareholder funds in generating profits.
ROE
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for TFC & BAC?
The Zacks Consensus Estimate for BAC's 2026 and 2027 earnings indicates 16.8% and 14.2% year-over-year growth, respectively. In the past week, the company’s earnings estimates for both years have been unchanged.
BAC Estimate Revision Trend
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for TFC’s 2026 and 2027 earnings indicates rallies of 14.4% and 13.3%, respectively. Earnings estimates for both years have been unchanged over the past seven days.
TFC Estimate Revision Trend
Image Source: Zacks Investment Research
BAC or TFC: Which Bank Is Positioned for Better Upside?
Bank of America seems well-positioned to capitalize on the current interest rate environment through its scale, diversified income streams and branch expansion strategy. Its robust earnings growth outlook, superior ROE and impressive capital distribution activities signal financial strength and shareholder value creation. The company’s digital innovations and cross-selling opportunities also provide a long-term competitive advantage.
Truist Financial, though less sensitive to rate shifts, presents relatively modest earnings growth. Its discounted valuation and expansion strategy may appeal to value investors, but overall, Bank of America appears the stronger long-term bet right now.
Currently, both TFC and BAC carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.