7 Blue Chip Stocks with Low PE Ratios

05. Bank of America Corporation (NYSE:BAC)

Forward Price to Earnings (P/E) ratio: 11.57

Number of Hedge Fund Holders: 92

Bank of America Corporation (NYSE:BAC) is a leading financial institution and stands out as a blue-chip stock with a low price-to-earnings (P/E) ratio. As of October 11, 2024, its forward P/E ratio is an attractive 11.57, making it an excellent candidate for value investors seeking established companies with strong fundamentals. With a diverse portfolio and steady growth, Bank of America Corporation (NYSE:BAC) continues to be a reliable choice in the financial sector, particularly for those looking for blue-chip stocks that offer both stability and growth potential at a relatively low valuation.

In its Q2 2024 earnings call, Bank of America Corporation (NYSE:BAC) exceeded expectations, reporting earnings per share (EPS) of $0.83 compared to the anticipated $0.797. The company’s net income for the quarter was $6.9 billion, showcasing the strength of its diversified operations. A balanced revenue split between its consumer and institutional businesses highlights the firm’s ability to navigate changing economic conditions effectively.

One of the standout aspects of Bank of America Corporation (NYSE:BAC) performance was the growth in non-interest income, which helped offset a slight decline in net interest income (NII). Notably, the bank’s wealth management business saw a 14% increase in asset management fees, and investment banking fees surged by 29% year-over-year. Additionally, the Global Markets division achieved its ninth consecutive quarter of year-over-year growth in sales and trading revenue, further contributing to the firm’s strong fee performance.

The bank’s focus on operational efficiency is evident from its 2% year-over-year expense growth, well below inflation rates. This operational discipline, combined with strategic investments in digital innovation and wealth management, positions the company for sustained growth. Bank of America Corporation (NYSE:BAC) also demonstrated its commitment to shareholder value by repurchasing $3.5 billion in shares and paying out $1.9 billion in dividends during the quarter.

With a robust CET1 ratio of 11.9%, Bank of America is well-capitalized, giving it flexibility to continue returning capital to shareholders and supporting future growth. This strong financial foundation, combined with its low forward P/E ratio, makes Bank of America Corporation (NYSE:BAC) an appealing blue-chip stock for value-oriented investors.