Gateway Investment Advisers LLC Cuts Position in Bank of America Corporation $BAC

Key Points

• Gateway Investment Advisers LLC reduced its stake in Bank of America by 6.6%, owning about 1.92 million shares valued at approximately $90.8 million after selling 134,600 shares.
• Bank of America recently declared a quarterly dividend of $0.28 per share, which represents an increase from the previous dividend of $0.26, and a dividend yield of 2.2%.
• A stock buyback program has been initiated, allowing Bank of America to repurchase up to $40 billion of its shares, indicating the board's belief that the stock is undervalued.

Gateway Investment Advisers LLC lowered its position in shares of Bank of America Corporation (NYSE:BAC - Free Report) by 6.6% in the second quarter, according to the company in its most recent 13F filing with the SEC. The fund owned 1,917,986 shares of the financial services provider's stock after selling 134,600 shares during the quarter. Bank of America accounts for 1.0% of Gateway Investment Advisers LLC's investment portfolio, making the stock its 17th largest holding. Gateway Investment Advisers LLC's holdings in Bank of America were worth $90,759,000 at the end of the most recent reporting period.

Other large investors also recently bought and sold shares of the company. Nova Wealth Management Inc. increased its holdings in shares of Bank of America by 75.2% in the 2nd quarter. Nova Wealth Management Inc. now owns 529 shares of the financial services provider's stock valued at $25,000 after purchasing an additional 227 shares in the last quarter. Vega Investment Solutions purchased a new position in shares of Bank of America in the 4th quarter valued at about $30,000. Wood Tarver Financial Group LLC purchased a new position in shares of Bank of America in the 4th quarter valued at about $38,000. Mascagni Wealth Management Inc. purchased a new position in shares of Bank of America in the 4th quarter valued at about $40,000. Finally, Cloud Capital Management LLC purchased a new position in shares of Bank of America in the 1st quarter valued at about $40,000. Hedge funds and other institutional investors own 70.71% of the company's stock.

Bank of America Trading Up 0.3%

Shares of Bank of America stock traded up $0.14 during mid-day trading on Friday, hitting $52.27. 98,925,969 shares of the stock were exchanged, compared to its average volume of 35,208,044. Bank of America Corporation has a twelve month low of $33.06 and a twelve month high of $52.66. The stock has a market capitalization of $387.16 billion, a price-to-earnings ratio of 15.28, a price-to-earnings-growth ratio of 2.02 and a beta of 1.34. The company has a 50-day simple moving average of $48.55 and a 200 day simple moving average of $44.52. The company has a current ratio of 0.80, a quick ratio of 0.79 and a debt-to-equity ratio of 1.14.

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

Bank of America announced that its board has initiated a stock buyback program 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 repurchase up to 11.1% of its shares through open market purchases. Shares repurchase programs are usually a sign that the company's board believes its shares are undervalued.

Bank of America Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Friday, September 26th. Shareholders of record on Friday, September 5th will be paid a dividend of $0.28 per share. The ex-dividend date of this dividend is Friday, September 5th. This represents a $1.12 annualized dividend and a dividend yield of 2.1%. This is an increase from Bank of America's previous quarterly dividend of $0.26. Bank of America's dividend payout ratio is 32.75%.

Insider Activity

In related news, insider James P. Demare sold 148,391 shares of the firm's stock in a transaction that occurred on Friday, August 1st. The shares were 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 of the company's stock, valued at approximately $10,180,656.99. This trade represents a 39.91% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. 0.30% of the stock is owned by corporate insiders.

Analyst Ratings Changes

BAC has been the subject of a number of research analyst reports. HSBC downgraded shares of Bank of America from a "buy" rating to a "hold" rating and increased their price target for the company from $47.00 to $51.00 in a report on Monday, July 7th. Hsbc Global Res downgraded shares of Bank of America from a "strong-buy" rating to a "hold" rating in a report on Tuesday, July 8th. Oppenheimer raised their target price on shares of Bank of America from $55.00 to $57.00 and gave the company an "outperform" rating in a report on Wednesday, July 30th. Wall Street Zen upgraded shares of Bank of America from a "sell" rating to a "hold" rating in a report on Saturday, September 13th. Finally, Morgan Stanley raised their target price on shares of Bank of America from $47.00 to $49.00 and gave the company an "overweight" rating in a report on Monday, June 23rd. Sixteen investment analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. According to MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and a consensus target price of $50.82.

Bank of America 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.