Bank of America (BAC) versus Its Competitors Financial Analysis

Bank of America (NYSE: BAC) is one of 311 public companies in the “Banks” industry, but how does it compare to its rivals? We will compare Bank of America to similar businesses based on the strength of its institutional ownership, risk, earnings, dividends, profitability, valuation and analyst recommendations.

Profitability

This table compares Bank of America and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bank of America 20.66% 8.33% 0.91%
Bank of America Competitors 18.66% 8.25% 0.93%

Risk & Volatility

Bank of America has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500. Comparatively, Bank of America’s rivals have a beta of 0.78, indicating that their average stock price is 22% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Bank of America and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bank of America 1 9 21 2 2.73
Bank of America Competitors 2261 8728 8773 359 2.36

Bank of America currently has a consensus price target of $27.16, suggesting a potential downside of 11.09%. As a group, “Banks” companies have a potential downside of 9.33%. Given Bank of America’s rivals higher probable upside, analysts plainly believe Bank of America has less favorable growth aspects than its rivals.

Institutional and Insider Ownership

68.4% of Bank of America shares are owned by institutional investors. Comparatively, 52.0% of shares of all “Banks” companies are owned by institutional investors. 0.2% of Bank of America shares are owned by company insiders. Comparatively, 10.4% of shares of all “Banks” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Bank of America pays an annual dividend of $0.48 per share and has a dividend yield of 1.6%. Bank of America pays out 27.9% of its earnings in the form of a dividend. As a group, “Banks” companies pay a dividend yield of 1.9% and pay out 34.9% of their earnings in the form of a dividend. Bank of America has increased its dividend for 4 consecutive years.

Earnings & Valuation

This table compares Bank of America and its rivals gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Bank of America $93.66 billion $17.91 billion 17.76
Bank of America Competitors $5.50 billion $827.87 million 395.94

Bank of America has higher revenue and earnings than its rivals. Bank of America is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Summary

Bank of America beats its rivals on 10 of the 15 factors compared.

About Bank of America

Bank of America Corporation is a bank holding company and a financial holding company. The Company is a financial institution, serving individual consumers and others with a range of banking, investing, asset management and other financial and risk management products and services. The Company, through its banking and various non-bank subsidiaries, throughout the United States and in international markets, provides a range of banking and non-bank financial services and products through four business segments: Consumer Banking, which comprises Deposits and Consumer Lending; Global Wealth & Investment Management, which consists of two primary businesses: Merrill Lynch Global Wealth Management and U.S. Trust, Bank of America Private Wealth Management; Global Banking, which provides a range of lending-related products and services; Global Markets, which offers sales and trading services, and All Other, which consists of equity investments, residual expense allocations and other.

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