1. Bank of America Corporation (NYSE:BAC)
Forward P/E Ratio: 9.91
Earnings Growth This Year: 13.03%
Number of Hedge Fund Holders: 113
Bank of America Corporation (NYSE:BAC) is an American multinational financial company that operates through various key business segments including Consumer Banking, Global Wealth, and Investment Management. Global Banking, and Global Markets. Its operations span over 35 countries and is categorized as one of the “Big Four” banking institutions in the US.
On April 8, Truist Financial analyst John McDonald CFA maintained a Buy rating on the stock with a price target of $50. Hardman Johnston Global Equity Strategy provided a bullish sentiment on Bank of America Corporation (NYSE:BAC) in its Q4 2024 investors letter. The fund noted that the bank is recognized as the second-largest bank in the developed world and operates the third-largest branch network in the United States. The bank makes 86% of its revenue from the United States and is expected to benefit from the Trump administration. Moreover, it also has a diversified portfolio across various banking segments including retail banking, commercial banking, wealth management, and investment banking.
During fiscal 2024, Bank of America Corporation (NYSE:BAC) generated $11 billion in revenue through its Consumer Banking segment. This contributed more than 40% to the total earnings. Moreover, it also has a strong digital presence with more than 14 billion logins and digital sales of more than 60% in Q4 alone. It is the top dirt-cheap stock to invest in now.
Hardman Johnston Global Equity Strategy stated the following regarding Bank of America Corporation (NYSE:BAC) in its Q4 2024 investor letter:
“Bank of America Corporation (NYSE:BAC) is the second largest bank in the developed world and operates the third largest branch network in the US. With 86% of revenues coming from the US, the bank is a clear beneficiary of the lower regulatory environment expected from the incoming administration. The company’s business is highly diversified across retail, commercial, wealth management, and investment banking, with significant scale across all verticals. Management believes there is a big opportunity going forward in growing and monetizing its mass retail client base. Wealth is another huge opportunity, with the Merrill Lynch platform enabling customers to make more transactions and purchase additional products. Lastly, Bank of America has an opportunity to increase efficiency through cost reduction and online banking. Our expectation is for the bank’s ROE to move significantly higher, driving EPS growth and higher multiples.”
While we acknowledge the potential of BAC to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than BAC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure. None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and investors. Please subscribe to our daily free newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
