Nomura Reiterates Bullish View on Bank of America (BAC) Following Strong Q3
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Nomura Securities analyst Steven Chubak reiterated his Buy rating and $19 price target on Bank of America (NYSE: BAC) following strong Q3 results, which he says provides fodder for bulls.
Chubak commented, "BAC reported 3Q EPS of $0.41 (>10% ROTE, ex DTA writedown, DVA loss), above our estimate of $0.32 and cons. of $0.34. Beat was driven by stronger fee income (+$0.03), notably in FICC / DCM, better efficiency (+$0.04), lower credit costs (+$0.01), and a lower tax rate (+$0.01, inclusive of DTA writedown). Other highlights: Strong core loan growth (+7% YoY), which helped drive NII / NIM resiliency; favorable consumer credit trends (lower NCOs, NPLs); and healthy builds in both CET1 (+40bps QoQ) and Tangible Book (+11% YoY). Bottom Line: BAC bulls should find the results encouraging with clear progress on multiple fronts; and while shares have performed strongly in recent months, we expect continued O/P off the back of this print, with favorable revenue / expense trends expected to drive cons. higher as well."
Shares of Bank of America closed at $16.05 yesterday.
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