Bank of America (NYSE:BAC) Stock Price Down 1.6% - Should You Sell?

Key Points

• Bank of America shares fell 1.6% on Tuesday, trading at $45.14 with a significant drop in trading volume, indicating reduced investor activity compared to previous sessions.
• Despite a recent quarterly earnings report showing a beat on EPS estimates at $0.89, the company's revenue fell short of expectations at $22.27 billion, leading to various adjustments in analyst ratings.
• Bank of America announced a quarterly dividend increase from $0.26 to $0.28 per share and initiated a $40 billion share buyback program, suggesting management's confidence in its stock value.

Bank of America Corporation (NYSE:BAC) traded down 1.6% during trading on Tuesday . The company traded as low as $44.75 and last traded at $45.14. 8,816,786 shares changed hands during mid-day trading, a decline of 79% from the average session volume of 42,716,887 shares. The stock had previously closed at $45.85.

Analyst Ratings Changes

A number of research analysts have commented on the company. Morgan Stanley upped their price objective on Bank of America from $47.00 to $49.00 and gave the company an "overweight" rating in a report on Monday, June 23rd. The Goldman Sachs Group upped their price objective on Bank of America from $46.00 to $52.00 and gave the company a "buy" rating in a report on Tuesday, June 10th. Hsbc Global Res lowered Bank of America from a "strong-buy" rating to a "hold" rating in a report on Tuesday, July 8th. Barclays cut their target price on Bank of America from $58.00 to $54.00 and set an "overweight" rating for the company in a research report on Wednesday, April 16th. Finally, Argus cut their target price on Bank of America from $53.00 to $47.00 and set a "buy" rating for the company in a research report on Wednesday, April 16th. One analyst has rated the stock with a sell rating, five have given a hold rating and seventeen have given a buy rating to the company's stock. Based on data from MarketBeat.com, the company has an average rating of "Moderate Buy" and a consensus price target of $50.13.

Bank of America Trading Down 0.6%

The firm has a 50 day moving average price of $46.32 and a two-hundred day moving average price of $43.76. The company has a market cap of $337.53 billion, a price-to-earnings ratio of 13.32, a PEG ratio of 1.78 and a beta of 1.31. The company has a quick ratio of 0.79, a current ratio of 0.80 and a debt-to-equity ratio of 1.14.

Bank of America (NYSE:BAC - Get Free Report) last announced its quarterly earnings data on Wednesday, July 16th. The financial services provider reported $0.89 EPS for the quarter, beating analysts' consensus estimates of $0.86 by $0.03. The firm had revenue of ($22,273.00) million during the quarter, compared to analysts' expectations of $26.79 billion. Bank of America had a return on equity of 10.25% and a net margin of 14.81%. The company's revenue for the quarter was up 4.3% compared to the same quarter last year. During the same quarter last year, the firm posted $0.83 earnings per share. As a group, equities analysts forecast that Bank of America Corporation will post 3.7 earnings per share 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. Investors of record on Friday, September 5th will be given a dividend of $0.28 per share. The ex-dividend date of this dividend is Friday, September 5th. This is a positive change from Bank of America's previous quarterly dividend of $0.26. This represents a $1.12 annualized dividend and a dividend yield of 2.5%. Bank of America's payout ratio is presently 30.41%.

Bank of America announced that its Board of Directors has approved a share buyback program on Wednesday, July 23rd that allows the company to buyback $40.00 billion in outstanding shares. This buyback authorization allows the financial services provider to repurchase up to 11.1% of its stock through open market purchases. Stock buyback programs are usually a sign that the company's management believes its stock is undervalued.

Insider Buying and Selling

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

Institutional Trading of Bank of America

Hedge funds have recently made changes to their positions in the company. Price T Rowe Associates Inc. MD grew its position in shares of Bank of America by 10.6% in the fourth quarter. Price T Rowe Associates Inc. MD now owns 122,437,422 shares of the financial services provider's stock valued at $5,381,126,000 after purchasing an additional 11,691,451 shares in the last quarter. Capital World Investors grew its position in shares of Bank of America by 23.9% in the fourth quarter. Capital World Investors now owns 88,210,527 shares of the financial services provider's stock valued at $3,876,853,000 after purchasing an additional 17,031,143 shares in the last quarter. Northern Trust Corp grew its position in shares of Bank of America by 17.2% in the fourth quarter. Northern Trust Corp now owns 67,935,940 shares of the financial services provider's stock valued at $2,985,785,000 after purchasing an additional 9,980,859 shares in the last quarter. Bank of New York Mellon Corp grew its position in shares of Bank of America by 1.3% in the first quarter. Bank of New York Mellon Corp now owns 60,417,407 shares of the financial services provider's stock valued at $2,521,218,000 after purchasing an additional 803,570 shares in the last quarter. Finally, Deutsche Bank AG grew its position in shares of Bank of America by 45.1% in the first quarter. Deutsche Bank AG now owns 48,112,090 shares of the financial services provider's stock valued at $2,007,718,000 after purchasing an additional 14,960,086 shares in the last quarter. 70.71% of the stock is currently owned by institutional investors.

About Bank of America

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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