Bank of America Co. (BAC) reported upbeat earnings on July 18, 2023, causing BAC Stock to rise 6.58%. The S&P 500 index gained 0.7% last week. The bank also announced that the periodic dividend should increase to $0.24 on September 29, 2023. Also, this jumper would allow the investors to gain 9.1% more yield as compared to 2022.
Bank of America Co. (BAC Stock): Financial Analysis
The recent announcement of a solid dividend yield places Bank of America following the industry average of 2.8%. The bank also has a strong history of over a decade of distributing earnings to its shareholders. Considering the last earnings report, the firm’s payout ratio is around 25%. This indicates that it shall be able to pay the dividends without affecting its balance sheets.
Since 2013, the Bank of America dividend surged from $0.04 total distributed annually to $0.88. It is making its compound annual growth rate (CAGR) of around 36% annually in the mentioned time frame. This scenario places BAC as a strong stock. The earnings per share swelled by around 13% in a span of five years.
Bank of America Co. (NYSE: BAC): Technical Analysis
At press time, BAC stock is trading at $31.98 with a rise of 0.92%. The previous close and open were at $31.69 and $31.67, respectively. The 52-week range is from $26.32 to $38.60, indicating that a strong momentum will be required to break the upper limit. With an average volume of 52.43 Million shares, the market cap is at $254.355 Billion.
The trailing twelve-month (TTM) price-to-earnings (P/E) ratio is 9.91, indicating an undervalued stock price. Also, at the same time, the (TTM) earnings per share (EPS) has been $3.48, showing strength. Analysts placed a price target at $36.26 with a 13.4% upside and provided a 2.38 rating for HOLD.
Bank of America Co. posted Q2 earnings on July 18, 2023, where the reported revenue of $25.197 Billion exceeded the expected value of $24.977 Billion by 0.88%. Comparing revenue to the previous quarter, it gained 8.60%. At the same time, the reported earnings were said to be $0.88 per share, surpassing the estimated value of $0.84 per share by 4.78%. Compared to the previous quarter, the EPS jumped by 20.55%.
The subsequent earnings will be reported on October 17, 2023, where revenue shall be around $25.119 Billion, while earnings would be about $0.828 per share. Operating expenses increased by 5.01% to $16.04 Billion, while net income gained 18.58% to $7.41 Billion.
Bank of America (BAC Stock): Candle Exploration
BAC Share price has been consolidating in the previous range since March 2023. It recently broke out after a positive earnings announcement. The current price action can also be seen trying to break and sustain over descending EMA. From here, the price shall face the crucial resistance present at $33.02.
A solid momentum occurs once the price crosses R1 at $34.31. Before that, the price action is supposed to consolidate in the expected range. Considering the fear of interest rate hikes, prices can fall and bounce off the demand zone. The price will have to sustain above EMA to have positive momentum.
Disclaimer:
The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets & stocks comes with a risk of financial loss.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
Source: https://www.thecoinrepublic.com/2023/07/24/bank-of-america-co-bac-stock-positive-earnings-and-dividend/