On Friday, Piper Sandler adjusted its price target for Bank of America stock (NYSE:BAC), bringing it down to $49.00 from the previous $50.00, while maintaining a Neutral stance on the financial institution's shares. Currently trading at $46.78 and near its 52-week high of $48.08, InvestingPro analysis suggests the stock is slightly undervalued. The revision follows the company's fourth-quarter 2024 earnings release and updated guidance, prompting the research firm to fine-tune its earnings per share (EPS) estimates for the coming years.
The analysts at Piper Sandler have revised their 2025 earnings per share estimate for Bank of America slightly downward from $3.69 to $3.68. For 2026, the forecast has been increased from $4.16 to $4.23. This nuanced adjustment in EPS expectations comes as InvestingPro data shows four analysts have revised their earnings downwards for the upcoming period. The bank maintains strong fundamentals with a market capitalization of $356 billion and a P/E ratio of 14.4x.
Explaining the rationale behind the new price target, the analyst noted that the adjustment reflects a modest shift in the 2025 earnings projection and the current banking valuation trends. The price target now represents approximately 13 times the estimated 2025 earnings per share, as opposed to the previously used multiple of around 14 times.
The decision to maintain a Neutral rating on Bank of America stock indicates that Piper Sandler's view on the bank's investment potential remains unchanged despite the minor alterations in EPS estimates and price target. The research firm's stance is based on the latest financial figures and market conditions as they relate to the bank's valuation.
Bank of America's stock price target adjustment and maintained rating by Piper Sandler come as the financial sector continues to navigate a dynamic economic environment, with analysts closely monitoring earnings results and guidance updates to provide investors with the most current assessments.
The bank has demonstrated consistent shareholder returns, maintaining dividend payments for 54 consecutive years with a current yield of 2.23%. For deeper insights into BAC's valuation and financial health metrics, investors can access the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Bank of America has been the subject of various important developments. The bank reported stronger-than-expected fourth-quarter earnings for 2024, delivering earnings per share (EPS) of $0.82, surpassing both Oppenheimer's and the consensus estimate of $0.77. This performance led Oppenheimer to increase the price target for Bank of America stock to $55.00, while maintaining an Outperform rating.
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