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Jun 08, 2023

Bank of America (BAC) Stock: A Promising Turnaround Opportunity After a 12% Decline

During Wednesday's trading session, the S&P 500 and Nasdaq Composite seemed to take a breather from their recent rally. The broad market index closed 0.38% lower, while the Nasdaq fell by 1.29%. The Dow 30 stocks bucked the trend with a modest gain of 0.27% or 91.74 points. Our robots closed with mixed results yesterday. The banking sector showed strong growth, leading the market. However, technology stocks experienced a correction after a prolonged period of gains. We view this correction as an opportunity to accumulate positions ahead of further growth.

Investors appear to be in a wait-and-see mode, anticipating the upcoming Federal Reserve policy meeting on June 13th and 14th. Economic indicators suggest that inflation is slowly easing, even though it remains above the central bank's target of 2%. For instance, wage growth is slowing down. According to Indeed data, average wages grew by 5.3% year-on-year in May, a 0.4 percentage point decrease compared to April.

According to the CME FedWatch Tool, markets are pricing in a 66% probability that the Fed will keep interest rates unchanged at the next meeting.

Additional economic data will be released on Thursday morning, including weekly jobless claims and wholesale inventories.

BAC stock looks promising for further growth. The RSI Indicator suggests an upward trend with a 62% probability. The Momentum Indicator, MACD, and moving averages also indicate potential upward movement. Recent 3-day advances have historically resulted in continued price growth with a 61% probability.

Related Ticker: BAC

BAC in upward trend: price expected to rise as it breaks its lower Bollinger Band on September 26, 2023

BAC may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In of 35 cases where BAC's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are .

Price Prediction Chart

Technical Analysis (Indicators)

Bullish Trend Analysis

The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where BAC's RSI Indicator exited the oversold zone, of 34 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .

The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 4 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.

Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where BAC advanced for three days, in of 317 cases, the price rose further within the following month. The odds of a continued upward trend are .

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 Moving Average Convergence Divergence Histogram (MACD) for BAC turned negative on September 22, 2023. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 42 similar instances when the indicator turned negative. In of the 42 cases the stock turned lower in the days that followed. This puts the odds of success at .

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.

Fundamental Analysis (Ratings)

Fear & Greed

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 Seasonality Score of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.

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 (0.859) is normal, around the industry mean (0.990). P/E Ratio (7.918) is within average values for comparable stocks, (17.310). Projected Growth (PEG Ratio) (7.479) is also within normal values, averaging (3.500). BAC has a moderately low Dividend Yield (0.033) as compared to the industry average of (0.056). P/S Ratio (2.237) is also within normal values, averaging (2.452).

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 72, placing this stock worse than average.

Notable companies

The most notable companies in this group are JPMorgan Chase & Co (NYSE:JPM), Bank of America Corp (NYSE:BAC), HSBC Holdings PLC (NYSE:HSBC), Wells Fargo & Co (NYSE:WFC), Citigroup (NYSE:C), Barclays PLC (NYSE:BCS).

Industry description

Major banks are among the biggest companies in the world, often times with global reach and market capitalizations in the multi-billions. Large banks often have multiple arms spanning different disciplines, from deposits, to investment banking, to wealth management and insurance. The biggest banks often have key competitive advantages over smaller players in the industry in terms of brand recognition, cost of capital, and efficiency. Think J.P. Morgan, Bank of America, Wells Fargo, and Citigroup.

Market Cap

The average market capitalization across the Major Banks Industry is 79.75B. The market cap for tickers in the group ranges from 191.41M to 421.44B. JPM holds the highest valuation in this group at 421.44B. The lowest valued company is MSL at 191.41M.

High and low price notable news

The average weekly price growth across all stocks in the Major Banks Industry was -1%. For the same Industry, the average monthly price growth was -0%, and the average quarterly price growth was 4%. BACHF experienced the highest price growth at 6%, while BACRP experienced the biggest fall at -12%.

Volume

The average weekly volume growth across all stocks in the Major Banks Industry was 16%. For the same stocks of the Industry, the average monthly volume growth was 5% and the average quarterly volume growth was -13%

Fundamental Analysis Ratings

The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows

Valuation Rating: 52
P/E Growth Rating: 60
Price Growth Rating: 51
SMR Rating: 11
Profit Risk Rating: 71
Seasonality Score: -4 (-100 ... +100)
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Technical Analysis# Of IndicatorsAvg. Odds
   
   
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A.I. Advisor
published General Information

General Information

a major bank

Industry MajorBanks

Profile
Fundamentals
Details
Industry
Major Banks
Address
100 North Tryon Street
Phone
+1 704 386-5681
Employees
217000
Web
https://www.bankofamerica.com
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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.

1D
1W
1M
1Q
6M
1Y
5Y
Ticker /
NAME
Correlation
To BAC
1D Price
Change %
BAC100%
-0.65%
WFC - BAC
83%
Closely correlated
-0.12%
C - BAC
80%
Closely correlated
-0.17%
JPM - BAC
80%
Closely correlated
-1.74%
BMO - BAC
72%
Closely correlated
-0.75%
EWBC - BAC
71%
Closely correlated
+0.63%
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