Head to Head Review: Bank of America (BAC) & Its Competitors

Bank of America (NYSE: BAC) is one of 307 publicly-traded companies in the “Banks” industry, but how does it contrast to its competitors? We will compare Bank of America to related businesses based on the strength of its dividends, risk, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Earnings and Valuation

This table compares Bank of America and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Bank of America $93.66 billion $17.91 billion 18.13
Bank of America Competitors $5.57 billion $838.22 million 406.22

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

Profitability

This table compares Bank of America and its competitors’ 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 18.62% 8.25% 0.93%

Analyst Recommendations

This is a breakdown of current recommendations for Bank of America and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bank of America 1 7 15 2 2.72
Bank of America Competitors 2410 8717 8747 369 2.35

Bank of America currently has a consensus target price of $28.84, indicating a potential downside of 7.53%. As a group, “Banks” companies have a potential downside of 11.71%. Given Bank of America’s stronger consensus rating and higher probable upside, analysts plainly believe Bank of America is more favorable than its competitors.

Institutional & 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 large money managers, endowments and hedge funds believe a company 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 1.5%. 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 35.3% of their earnings in the form of a dividend. Bank of America has raised its dividend for 4 consecutive years.

Risk & Volatility

Bank of America has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500. Comparatively, Bank of America’s competitors have a beta of 0.80, meaning that their average stock price is 21% less volatile than the S&P 500.

Summary

Bank of America beats its competitors on 11 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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