Knowing facts before you bet on it

Bank of America (Bac) has recently been one of the most sought stocks on Zacks.com. Perhaps you would like to see some of the facts that could affect the performance of the stock at short notice.

Last month, the shares of the second largest bank of this country returned +16.6%, compared to the changes in the Zack S&P 500 Composite +10.6%. During this time, the Zacks Financial investment Bank, which the Bank of America falls, has increased by 18.5%. The key question now is: What could be the future direction of the stock?

While media publications or rumors about a significant change in the business prospects of a company usually carry out its shares as a “trend” and lead to an immediate change in price, there are always some basic facts that ultimately dominate the purchase and hate decision finding.

Instead of concentrating on anything else, we prioritize the evaluation of the change in the profit projection of a company at Zacks. This is due to the fact that we believe that the current value for its shares is determined by the cash value of his future profit current.

We essentially take a look at how analysts that cover the shares reveal their profit estimates in order to reflect the effects of the latest business trends. And if the profit estimates for a company rise, the current value for its shares increases. A higher atmosphere to be used than the current market price gives investors the interest for buying the share, which leads at a higher price. For this reason, empirical research shows a strong correlation between trends in the revisions of the yield estimate and short -term share price movements.

For the current quarter, the Bank of America is expected to make a profit of $ 0.90 per share, which indicates a change of +8.4% compared to the previous year. The Zacks Consensus estimate has changed in the past 30 days by -2.3%.

For the current financial year, the consensus estimate of $ 3.67 refers to a change of +11.9% compared to the previous year. This estimate has remained unchanged in the past 30 days.

For the next financial year, the consensus estimate of 4.25 USD shows a change of +15.7% compared to what the Bank of America is expected a year ago. The estimate has changed last month -1.7%.

Our proprietary stock assessment tool, The Zacks Rank, offers a strong externally tested track record and offers a more conclusive picture of the price direction of a share at short notice, as it effectively uses the power of profits. Due to the size of the recent change in the consensus estimate and three other factors in connection with profit estimates, the Bank of America is ranked 3rd (hold).

The following table shows the development of the company's 12-month consensus EPS EPS estimate:

12-month consensus EPS estimate for BAC _12MonthepScharturl

While profit growth is probably the most superior indicator of a company's financial health, nothing happens than such if a company cannot increase its income. After all, it is almost impossible for a company to increase its income over a longer period of time without increasing its income. It is therefore important to know the potential sales growth of a company.

In the case of the Bank of America, the consensus turnover of $ 26.72 billion shows for the current quarter to change +5.3%compared to the previous year. The estimates between 107.99 billion US dollars and 113.89 billion US dollars for the current and next financial years show changes of +6% or +5.5%.

The Bank of America reported sales of $ 27.37 billion in the last reported quarter, which corresponds to a change of +6%compared to the previous year. EPS of $ 0.90 for the same period comparable to $ 0.83 a year ago.

Compared to the Zacks Consensus estimate of 26.86 billion US dollars, the registered income is a surprise of +1.89%. The EPS surprise was +11.11%.

The company defeated consensus -epseps estimates in each of the following four quarters. The company exceeded consensus sales every time.

Without taking into account the assessment of a share, no investment decision can be efficient. When predicting the future price performance of a share, it is crucial to determine whether the current price correctly reflects the internal value of the underlying business and the company's growth prospects.

The comparison of the current value of the valuation multipliers of a company, such as

As part of the ZACKS Style Scores system, the Zacks Value Style Score (which rates both traditional and unconventional valuation metrics) organizes shares in five groups that are rich from A to F (A is better than B; b is better than C; and so on).

The Bank of America is evaluated on this front to F, which points out that it acts with his colleagues with a bonus. Click here to display the values of some evaluation metrics that have driven this grade.

The facts discussed here and a lot of other information about Zacks.com could help determine whether it is worth paying attention to the Bank of America market or not. However, the Zacks ranked 3rd indicate that it is in line with the broader market at short notice.

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Bank of America Corporation (BAC): Report on free stock analysis

This article was originally published in Zack's Investment Research (Zacks.com).

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