Bank of America (NYSE:BAC) Issues Quarterly Earnings Results, Beats Expectations By $0.02 EPS

Bank of America Corporation (NYSE:BAC) posted its earnings results on Wednesday. The financial services provider reported $0.98 earnings per share for the quarter, topping analysts’ consensus estimates of $0.96 by $0.02, FiscalAI reports. Bank of America had a net margin of 15.70% and a return on equity of 10.76%. The firm had revenue of $28.53 billion for the quarter, compared to analyst estimates of $27.73 billion. During the same period in the previous year, the firm posted $0.82 EPS. The company’s revenue for the quarter was up 12.3% compared to the same quarter last year.

Here are the key takeaways from Bank of America’s conference call:

• Strong fourth-quarter and full‑year results: Q4 net income was $7.6 billion (up 12% YoY) and EPS $0.98 (up 18%), with full‑year revenue up 7% and net interest income rising 10% to $15.9 billion.
• Operating leverage and expense discipline drove performance — the company delivered about 330 basis points of operating leverage in Q4, 250 bps for the year, held headcount roughly flat while investing in technology/AI, and expects ~200 bps of operating leverage in 2026.
• Loan and NII growth momentum: average loans grew 8% YoY (commercial-led), average deposits grew 3% and management expects mid‑single digit loan growth with NII growth of 5%–7% in 2026 driven by asset repricing and deposit-driven balance sheet optimization.
• Accounting change reduced regulatory capital: an accounting method change for tax‑related equity investments had an insignificant net‑income effect but reduced CET1 by roughly $2.1 billion (about 12 bps) to a CET1 ratio of 11.4%, a modest near‑term headwind to capital metrics.
• Business momentum and risks: Wealth and Global Markets showed strong flows and record sales & trading revenue, but management noted low loss rates (NCOs ~44 bps), ongoing deposit dynamics, and policy/regulatory risks (e.g., proposed card yield caps, stablecoin developments) that warrant monitoring.

Bank of America Stock Performance

Shares of BAC stock opened at $52.42 on Thursday. The firm has a 50 day moving average of $54.19 and a 200-day moving average of $51.15. The company has a market cap of $382.78 billion, a price-to-earnings ratio of 14.28 and a beta of 1.29. The company has a quick ratio of 0.79, a current ratio of 0.79 and a debt-to-equity ratio of 1.12. Bank of America Corporation has a 52 week low of $33.06 and a 52 week high of $57.55.

Bank of America Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Friday, December 26th. Shareholders of record on Friday, December 5th were issued a dividend of $0.28 per share. This represents a $1.12 dividend on an annualized basis and a dividend yield of 2.1%. The ex-dividend date was Friday, December 5th. Bank of America’s dividend payout ratio is presently 30.52%.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently bought and sold shares of the stock. Wiser Advisor Group LLC bought a new stake in Bank of America in the third quarter valued at $27,000. Osterweis Capital Management Inc. bought a new position in shares of Bank of America during the 3rd quarter worth about $36,000. Triumph Capital Management acquired a new stake in shares of Bank of America in the 3rd quarter valued at about $58,000. Wealth Watch Advisors INC bought a new stake in Bank of America in the 3rd quarter valued at about $85,000. Finally, WFA of San Diego LLC acquired a new position in Bank of America during the 2nd quarter worth approximately $165,000. 70.71% of the stock is owned by institutional investors.

Analysts Set New Price Targets

Several brokerages recently issued reports on BAC. Argus raised their target price on Bank of America from $53.00 to $58.00 in a research report on Friday, October 17th. Hsbc Global Res raised Bank of America from a “hold” rating to a “strong-buy” rating in a research note on Wednesday, January 7th. Erste Group Bank upgraded Bank of America from a “hold” rating to a “buy” rating in a research report on Friday, October 3rd. TD Cowen lifted their price objective on Bank of America from $64.00 to $66.00 and gave the stock a “buy” rating in a research note on Wednesday, January 7th. Finally, UBS Group increased their target price on shares of Bank of America from $55.00 to $57.00 and gave the company a “buy” rating in a research report on Tuesday, October 7th. One investment analyst has rated the stock with a Strong Buy rating, twenty-four have assigned a Buy rating and four have issued a Hold rating to the stock. According to MarketBeat.com, Bank of America presently has an average rating of “Moderate Buy” and a consensus price target of $59.91.

Bank of America News Roundup

Here are the key news stories impacting Bank of America this week:

• Positive Sentiment: Q4 beat — BAC reported $0.98 EPS vs. $0.96 expected and revenue above consensus, with net income of ~$7.6B; top‑ and bottom‑line beats underpin the firm’s core earnings momentum. PR Newswire: Bank of America Reports Fourth Quarter 2025 Financial Results
• Positive Sentiment: Trading & AI-driven efficiency — Elevated client trading activity and AI/digital tools (Erica) boosted noninterest efficiency and helped reduce hiring/costs, supporting operating leverage. Benzinga: Bank Of America Tops Q4 Estimates As AI Drives Account Growth
• Positive Sentiment: Clean balance sheet & guidance — Management highlighted 5–7% net interest income growth guidance for 2026, healthy CET1 (11.4%), low charge-offs and loan/deposit growth, which argue for durable earnings power. MarketBeat: Bank Stocks Get Punished After Earnings
• Neutral Sentiment: Bank of America Securities activity (external coverage) — BofA Securities analysts reiterated Buy ratings on other firms (e.g., Toyota, Roblox), which is background for the parent firm’s research franchise but not a direct driver of BAC’s share move. TipRanks: Merrill Lynch Upgrades Toyota Motor
• Neutral Sentiment: Investor takeaways from the call — Management is constructive on the U.S. economy and emphasized technology-driven customer growth; useful context but not enough to reverse short-term sentiment. TipRanks: Bank of America Earnings Call Highlights
• Negative Sentiment: Market punished valuation and guidance nuance — Despite the beat, investors focused on a softer forward tone for net interest income mix and any signals that future NII growth could be slower, prompting profit-taking. The Motley Fool: BAC Falls After Strong Earnings Meet Softer NII Outlook
• Negative Sentiment: Sector/valuation overhang & policy risk — Elevated bank valuations and headlines about a proposed cap on credit card rates created an extra overhang for BAC and peers, raising concern about future profitability for card portfolios. MarketBeat: Bank Stocks Get Punished After Earnings
• Negative Sentiment: Line‑of‑business softness — Some coverage noted weaker investment banking or mixed IB trends that trimmed upside expectations despite strong trading and NII. Zacks: BAC Q4 Tops as Trading & NII Shine, Stock Slides on Weak IB

Bank of America Company Profile

Bank of America Corporation is a multinational financial services company headquartered in Charlotte, North Carolina. It provides a broad array of banking, investment, asset management and related financial and risk management products and services to individual consumers, small- and middle-market businesses, large corporations, governments and institutional investors. The firm operates through consumer banking, global wealth and investment management, global banking and markets businesses, offering capabilities across lending, deposits, payments, advisory and capital markets.

Its consumer-facing offerings include checking and savings accounts, mortgages, home equity lending, auto loans, credit cards and small business banking, supported by a nationwide branch network and digital channels.