$BAC, $WFC, $HSBC, $TD, $C, and Other Banks Looking Weaker Than the Market: A Banking Sector Analysis
Last week, the market showed significant growth, with indices gaining more than 2%. However, the banking sector, on average, saw a 1% increase. If this upward momentum continues, the banking sector might also demonstrate substantial growth and catch up with the broader indices. To receive real-time signals for stocks, consider subscribing to our trading bot: Swing-Trader-Medium-Volatility-Stocks-for-Active-Trading-TA-FA.
Within this industry, prominent players include JPMorgan Chase & Co (NYSE:JPM), Bank of America Corp (NYSE:BAC), Wells Fargo & Co (NYSE:WFC), HSBC Holdings PLC (NYSE:HSBC), Citigroup (NYSE:C), and Barclays PLC (NYSE:BCS).
Industry Insight
Major banks are behemoths in the global financial landscape, boasting market capitalizations often soaring into the multi-billions. These financial giants operate diverse arms, ranging from deposit services to investment banking, wealth management, and insurance. Their immense size provides significant competitive advantages, including brand recognition, favorable cost of capital, and operational efficiency. Notable institutions such as J.P. Morgan, Bank of America, Wells Fargo, and Citigroup exemplify the industry's scale and influence.
Market Capitalization Metrics
The Major Banks Industry boasts an impressive average market capitalization of 80.2 billion dollars. Market caps for individual companies in this sector span a wide range, from as low as 191.4 million dollars for MSL to an astonishing 426.7 billion dollars for JPMorgan Chase & Co (JPM), which currently leads the pack in terms of valuation.
Price Performance Highlights
Over the recent period, the Major Banks Industry experienced an average weekly price growth of 1.83%. However, it faced headwinds at the monthly and quarterly horizons, with average price growth rates of -2.06% and -3.11%, respectively. Among the noteworthy performers, UBS stood out with an impressive price growth of 7.16%, while BACRP faced the steepest decline, plunging by -11.64% in the reported period.
Volume Metrics
Trading volumes also exhibited notable dynamics. On a weekly basis, the Major Banks Industry registered an average volume growth rate of 24.23%. Monthly volume growth was equally robust, averaging 24.99%, while quarterly volume growth settled at 9.14%. Notably, Toronto Dominion Bank saw a remarkable one-day spike in volume, surging to a record-breaking 237% of the 65-Day Volume Moving Average on August 23, 2023. In a similar vein, HSBC Holdings witnessed a surge in trading volume, reaching 231% of the 65-Day Volume Moving Average on March 14, 2023.
Fundamental Analysis Ratings
In terms of fundamental analysis ratings, which range from 1 (best) to 100 (worst), the Major Banks Industry showcases the following scores:
- Valuation Rating: 51
- P/E Growth Rating: 59
- Price Growth Rating: 55
- SMR Rating: 11
- Profit Risk Rating: 77
- Seasonality Score: -3 (-100 ... +100)
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BAC on the Upswing: Potential Price Rebound
BAC (Bank of America Corp) appears to be on an upward trajectory as it broke its lower Bollinger Band on August 15, 2023. This breakout suggests the stock could rebound and approach the middle band, potentially making it an attractive opportunity for traders to consider buying the stock or exploring call options. Historical data indicates that in 29 out of 37 similar instances where BAC's price ventured below its lower Bollinger Band, the price continued to rise in the following month, with odds of a sustained uptrend at 78%.
WFC's Aroon Indicator Signals a Downward Trend
WFC (Wells Fargo & Co) has encountered a bearish signal as its Aroon Indicator entered a downward trend on September 1, 2023. This trend is characterized by the AroonDown red line rising above 70 while the AroonUp green line falls below 30 for three consecutive days, indicating the potential for a substantial downward movement. Traders may contemplate selling the stock or acquiring put options. Analysis of 180 similar occurrences of this Aroon Indicator pattern reveals that in 119 cases, the stock price declined, presenting a 66% probability of a downward move.
HSBC in a Short-Term Downtrend
HSBC Holdings (HSBC) has experienced a short-term downtrend, declining for three consecutive days until August 31, 2023. This three-day descent is often regarded as a bearish sign, suggesting the need for vigilance regarding potential further declines in the stock. Historical data shows that in 155 out of 285 instances when HSBC declined for three days, the price continued to decrease within the following month, resulting in a 54% likelihood of a continued downward trend.
TD Poised for an Upswing
TD (Toronto-Dominion Bank) shows promise for an upward trend as it broke its lower Bollinger Band on August 24, 2023. This could signify a potential price rise, with the stock possibly moving back towards the middle band. Traders may consider purchasing the stock or exploring call options. Analysis of 40 similar occurrences where TD's price dipped below its lower Bollinger Band reveals that in 23 instances, the price advanced further in the following month, indicating a 57% probability of a sustained upward trend.
C's Stochastic Oscillator Indicates Potential Upside
On August 31, 2023, Citigroup (C) saw its Stochastic Indicator exit the oversold territory, which could be interpreted as a bullish signal for the stock. Traders may contemplate buying the stock or acquiring call options. Historical data analysis of 59 instances where the Stochastic Indicator left the oversold zone indicates that in 42 of these instances, the stock price moved higher in the ensuing days, offering odds of over 71% for an upward move.
BAC sees MACD Histogram just turned negative
BAC saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on September 22, 2023. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 42 instances where the indicator turned negative. In of the 42 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on September 21, 2023. You may want to consider selling the stock, shorting the stock, or exploring put options on BAC as a result. In of 80 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The 10-day moving average for BAC crossed bearishly below the 50-day moving average on August 22, 2023. This indicates that the trend has shifted lower and could be considered a sell signal. In of 13 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where BAC declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for BAC entered a downward trend on September 01, 2023. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The RSI Indicator demonstrates that the ticker has stayed in the oversold zone for 1 day, which means it's wise to expect a price bounce in the near future.
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 1 day, which means it's wise to expect a price bounce in the near future.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where BAC advanced for three days, in of 316 cases, the price rose further within the following month. The odds of a continued upward trend are .
BAC may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. BAC’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.860) is normal, around the industry mean (0.992). P/E Ratio (7.930) is within average values for comparable stocks, (16.894). Projected Growth (PEG Ratio) (7.490) is also within normal values, averaging (3.508). BAC has a moderately low Dividend Yield (0.033) as compared to the industry average of (0.056). P/S Ratio (2.241) is also within normal values, averaging (2.461).
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. BAC’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 74, placing this stock worse than average.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a major bank
Industry MajorBanks
BAC and
Correlation & Price change
A.I.dvisor indicates that over the last year, BAC has been closely correlated with WFC. These tickers have moved in lockstep 83% of the time. This A.I.-generated data suggests there is a high statistical probability that if BAC jumps, then WFC could also see price increases.