Bank of America (NYSE:BAC) Hits New 52-Week High - Here's Why

Key Points

• Bank of America (NYSE:BAC) reached a new 52-week high, trading at $52.81, with a significant trading volume of 1,993,555 shares.
• The company recently increased its quarterly dividend from $0.26 to $0.28 per share and announced a $40 billion stock buyback plan, indicating management's belief that the shares are undervalued.
• Analyst ratings for Bank of America have varied, with 16 analysts giving it a Buy rating, while some have downgraded it, with an average price target of $50.76.

Bank of America Corporation (NYSE:BAC) reached a new 52-week high during trading on Tuesday . The stock traded as high as $52.81 and last traded at $52.76, with a volume of 1993555 shares. The stock had previously closed at $51.92.

Analysts Set New Price Targets

BAC has been the subject of several recent analyst reports. Hsbc Global Res cut Bank of America from a "strong-buy" rating to a "hold" rating in a research note on Tuesday, July 8th. Truist Financial raised their target price on Bank of America from $51.00 to $53.00 and gave the stock a "buy" rating in a research note on Wednesday, July 9th. Wall Street Zen raised Bank of America from a "sell" rating to a "hold" rating in a research note on Saturday, September 13th. Morgan Stanley raised their target price on Bank of America from $47.00 to $49.00 and gave the stock an "overweight" rating in a research note on Monday, June 23rd. Finally, Phillip Securities lowered Bank of America from a "strong-buy" rating to a "moderate buy" rating in a report on Friday, July 25th. Sixteen analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company's stock. According to MarketBeat, the company has an average rating of "Moderate Buy" and an average price target of $50.76.

Bank of America Stock Up 1.4%

The company has a debt-to-equity ratio of 1.14, a current ratio of 0.80 and a quick ratio of 0.79. The stock has a fifty day moving average price of $48.65 and a two-hundred day moving average price of $44.63. The company has a market cap of $389.79 billion, a P/E ratio of 15.39, a price-to-earnings-growth ratio of 2.03 and a beta of 1.34.

Bank of America (NYSE:BAC - Get Free Report) last posted its earnings results on Wednesday, July 16th. The financial services provider reported $0.89 earnings per share for the quarter, beating analysts' consensus estimates of $0.86 by $0.03. Bank of America had a return on equity of 10.25% and a net margin of 14.81%.The company had revenue of ($22,273.00) million for the quarter, compared to analyst estimates of $26.79 billion. During the same quarter last year, the company earned $0.83 earnings per share. The company's revenue for the quarter was up 4.3% on a year-over-year basis. On average, research analysts expect that Bank of America Corporation will post 3.7 EPS for the current year.

Bank of America Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, September 26th. Stockholders of record on Friday, September 5th will be issued a $0.28 dividend. This is a boost from Bank of America's previous quarterly dividend of $0.26. This represents a $1.12 dividend on an annualized basis and a dividend yield of 2.1%. The ex-dividend date is Friday, September 5th. Bank of America's dividend payout ratio is 32.75%.

Bank of America declared that its board has authorized a share buyback plan on Wednesday, July 23rd that authorizes the company to repurchase $40.00 billion in outstanding shares. This repurchase authorization authorizes the financial services provider to reacquire up to 11.1% of its stock through open market purchases. Stock repurchase plans are usually a sign that the company's leadership believes its shares are undervalued.

Insider Buying and Selling

In related news, insider James P. Demare sold 148,391 shares of Bank of America stock in a transaction on Friday, August 1st. The stock was sold at an average price of $45.57, for a total transaction of $6,762,177.87. Following the sale, the insider directly owned 223,407 shares in the company, valued at approximately $10,180,656.99. This trade represents a 39.91% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. Company insiders own 0.30% of the company's stock.

Institutional Trading of Bank of America

Large investors have recently bought and sold shares of the company. Nicholas Hoffman & Company LLC. increased its position in Bank of America by 121.0% in the first quarter. Nicholas Hoffman & Company LLC. now owns 62,041 shares of the financial services provider's stock worth $2,589,000 after buying an additional 33,963 shares during the last quarter. Gradient Investments LLC increased its position in Bank of America by 7.8% in the first quarter. Gradient Investments LLC now owns 696,416 shares of the financial services provider's stock worth $29,061,000 after buying an additional 50,296 shares during the last quarter. Prosperity Wealth Management Inc. purchased a new stake in Bank of America in the first quarter worth $998,000. Alpha Cubed Investments LLC increased its position in Bank of America by 37.2% in the first quarter. Alpha Cubed Investments LLC now owns 65,038 shares of the financial services provider's stock worth $2,714,000 after buying an additional 17,619 shares during the last quarter. Finally, International Assets Investment Management LLC increased its position in Bank of America by 170.5% in the first quarter. International Assets Investment Management LLC now owns 238,473 shares of the financial services provider's stock worth $9,951,000 after buying an additional 150,299 shares during the last quarter. 70.71% of the stock is owned by hedge funds and other institutional investors.

Bank of America Company Profile

Bank of America Corporation, through its subsidiaries, provides banking and financial products and services for individual consumers, small and middle-market businesses, institutional investors, large corporations, and governments worldwide. It operates in four segments: Consumer Banking, Global Wealth & Investment Management (GWIM), Global Banking, and Global Markets.

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