Financial Services / Banking
One of the largest US banks serving consumers, small businesses, and large corporations.
View forensic reportAt 12.2x forward earnings and 1.375x book value, BAC's Q1 results reveal an NII inflection, capital markets outperformance, and $25 billion in buyback capacity the market has not fully priced.
Both banks have rallied into earnings week. The valuation gap between them has tightened to a multi-year low. Which one is priced correctly?
The thesis from our capital allocation coverage has been validated, but at 12x forward earnings with a PEG below 1.0, Bank of America still offers the best growth-adjusted value in big banking.
BAC trades at 13.8x earnings — a 25% discount to JPMorgan — despite posting a 41.6% operating margin and $30.5 billion in net income. The discount is a mispricing, and the $40 billion trading quarter is about to prove it.
BAC offers NIM expansion at 12.3x forward earnings, JPM delivers 21% ROTCE at 12.7x, and Goldman's IB pipeline recovery at 13.8x could drive 25-30% upside.
BAC trades at 13x forward earnings while growing net interest income at 12% annually. Management just flagged international expansion as the next growth lever — the market yawned.
JPMorgan offers fortress-grade defence at 13.7x forward, Goldman Sachs rides capital markets momentum after an 89% surge, and Bank of America bets on rate sensitivity.