NYSE:BAC

Bank of America (BAC)

50.56
-0.52 (1.02%)
as of Oct 23, 2026, 8:00:00 pm Market Closed.
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COMMENT

He would buy Bank of America. The stock is still very cheap, price to book value. It has a decent growth rate. This is the one to be buying in this kind of climate.

DON'T BUY
It's cheap vs. upside potential, though pricey vs. its past. He hopes it returns to $36.50, but negative interest rates aren't good.
BUY
A terrific business. US banks are well-capitalized. BAC is doing well introducing their business into new markets, though don't expect them to do big acquisitions. BAC is using tech aggressively to cut costs and in turn reinvest those savings. Low and declining interest rates are a neutral to modest negative factor.
PAST TOP PICK
(A Top Pick Nov 02/18, Up 9%) BAC is holding on as banks around the world are struggling. The most capitalized bank in America. It's been in a trading range the past year.
BUY ON WEAKNESS
The U.S. banks have had a big rally with the Fed's cutting interest rates. They are a bit pricy right now. They've been buying back shares and they have had little growth.
DON'T BUY
C-N would be much cheaper. It is much more internationally focused. BAC-N is much more domestic focused. The flat yield curve and negative yields is not good for either of them. It is a tough sector to invest in.
WAIT
There is a lot of reasons why they should win relative to their peers -- wealth management and potential into Europe. The problem is interest rates are not cooperating. They have large free balances on savings and trading deposits, making them very sensitive to rate declines. He would wait for a time when there is more clarity on the direction of these rates.
COMMENT
Time to add on? A big and steady US bank -- you can expect continued performance from them. They will work their way through the flat interest rate environment. This is not an expensive stock, pays a good dividend, and has a good ROC. Yield 2.5%
DON'T BUY
It comes down to the direction of interest rates. He feels they will go lower, and the U.S. may even go negative. This will hurt the banks--look at Europe now.
HOLD
We’ve seen cyclical areas of the market, like consumer and banks, really moved on that notion. If the Fed is able to engineer a steeper yield curve, this will help BAC. Thinks that you can hold this long, and he doesn’t think it will tank. (Analysts’ price target is $35.00)
DON'T BUY
The US banks reacted well to Powell's rate cut today, but a lower rate in general means the banks will struggle with shrinking margins. BAC is the most levered to interest rates, so you don't want to own this. He sold his shares over the winter when the Fed changed direction.
COMMENT

He likes the US banks and prefers JPM, but they're all hamstrung in what they can do and acquire. They will increase dividends and buyback shares. Earnings growth will come from committing their profits to share buybacks. BAC enjoys quality earnings. Debt is fine. Sinking interest rates will squeeze their margins, but they have other businesses outside lending to offset that.

HOLD
The challenge is this is a very low interest rate environment and that makes it tough for banks to make money. If you expect interest rates to return to normal yields, this would be a good entry level. He would not be selling here -- continue to hold.
COMMENT
The financials are a little frothy. If he was a trader, he would sell at $30. If you are long term, would hold it. It is no longer a volatile trader, but it is range bound in a $5 range.
WEAK BUY

Same thoughts as with Citibank today. Expect challenges in this space. A lot of recessionary concerns have been priced into US banks but are overdone. You could add a little at current levels.

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