Bank of America (NYSE:BAC) Trading Down 1.6% - Here's Why

Key Points

• Bank of America (NYSE:BAC) shares fell 1.6% to $51.58, with a trading volume decrease of 28% from its average daily volume.
• HSBC downgraded the stock from a "buy" to a "hold" rating, raising their price target to $51, while Goldman Sachs set a target price of $55.
• The company declared a quarterly dividend of $0.28, up from $0.26, with a dividend yield of 2.2% and a share repurchase plan authorized for $40 billion.

Bank of America Corporation (NYSE:BAC)'s stock price was down 1.6% during mid-day trading on Tuesday . The company traded as low as $51.02 and last traded at $51.58. Approximately 29,647,043 shares were traded during trading, a decline of 28% from the average daily volume of 41,252,211 shares. The stock had previously closed at $52.42.

Wall Street Analysts Forecast Growth

Several equities research analysts have weighed in on BAC shares. HSBC cut Bank of America from a "buy" rating to a "hold" rating and upped their target price for the stock from $47.00 to $51.00 in a research note on Monday, July 7th. Hsbc Global Res downgraded Bank of America from a "strong-buy" rating to a "hold" rating in a report on Tuesday, July 8th. The Goldman Sachs Group set a $55.00 price target on Bank of America in a report on Tuesday. Wall Street Zen upgraded Bank of America from a "sell" rating to a "hold" rating in a research note on Saturday, September 13th. Finally, Evercore ISI raised their price target on shares of Bank of America from $49.00 to $55.00 and gave the company an "outperform" rating in a research report on Tuesday. Seventeen analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. According to data from MarketBeat, Bank of America has a consensus rating of "Moderate Buy" and a consensus target price of $52.63.

Bank of America Price Performance

The firm has a market capitalization of $382.05 billion, a PE ratio of 15.08, a price-to-earnings-growth ratio of 2.02 and a beta of 1.34. The company has a debt-to-equity ratio of 1.14, a quick ratio of 0.79 and a current ratio of 0.80. The business's 50 day moving average is $49.16 and its two-hundred day moving average is $45.05.

Bank of America (NYSE:BAC - Get Free Report) last released its quarterly earnings data 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. The business had revenue of ($22,273.00) million during the quarter, compared to analyst estimates of $26.79 billion. Bank of America had a net margin of 14.81% and a return on equity of 10.25%. Bank of America's revenue was up 4.3% compared to the same quarter last year. During the same period in the previous year, the business earned $0.83 EPS. Equities research analysts anticipate that Bank of America Corporation will post 3.7 earnings per share for the current fiscal year.

Bank of America Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Friday, September 26th. Stockholders of record on Friday, September 5th were given a dividend of $0.28 per share. This is an increase from Bank of America's previous quarterly dividend of $0.26. The ex-dividend date was Friday, September 5th. This represents a $1.12 dividend on an annualized basis and a dividend yield of 2.2%. Bank of America's dividend payout ratio (DPR) is presently 32.75%.

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

Insider Activity at Bank of America

In other news, insider James P. Demare sold 148,391 shares of the business's stock in a transaction on Friday, August 1st. The shares were sold at an average price of $45.57, for a total transaction of $6,762,177.87. Following the completion of the transaction, 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 position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. 0.30% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in BAC. Nicholas Hoffman & Company LLC. grew 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 acquiring an additional 33,963 shares in the last quarter. Gradient Investments LLC grew 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 acquiring an additional 50,296 shares in the last quarter. Prosperity Wealth Management Inc. purchased a new position in Bank of America in the first quarter worth $998,000. Alpha Cubed Investments LLC grew 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 acquiring an additional 17,619 shares in the last quarter. Finally, International Assets Investment Management LLC grew 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 acquiring an additional 150,299 shares in the last quarter. 70.71% of the stock is currently 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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