Bank of America Corporation
Bank of America Corporation Fundamental Analysis
Bank of America Corporation (BAC-PS) shows strong financial fundamentals with a PE ratio of 11.28, profit margin of 16.23%, and ROE of 10.19%. The company generates $183.9B in annual revenue with strong year-over-year growth of 11.94%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 46.9/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze BAC-PS's fundamental strength across five key dimensions:
Efficiency Score
WeakBAC-PS struggles to generate sufficient returns from assets.
Valuation Score
ModerateBAC-PS shows balanced valuation metrics.
Growth Score
ModerateBAC-PS shows steady but slowing expansion.
Financial Health Score
WeakBAC-PS carries high financial risk with limited liquidity.
Profitability Score
ModerateBAC-PS maintains healthy but balanced margins.
Key Financial Metrics
Is BAC-PS Expensive or Cheap?
P/E Ratio
BAC-PS trades at 11.28 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, BAC-PS's PEG of 2.62 indicates potential overvaluation.
Price to Book
The market values Bank of America Corporation at 1.14 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 5.61 times EBITDA. This is generally considered low.
How Well Does BAC-PS Make Money?
Net Profit Margin
For every $100 in sales, Bank of America Corporation keeps $16.23 as profit after all expenses.
Operating Margin
Core operations generate 18.48 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $10.19 in profit for every $100 of shareholder equity.
ROA
Bank of America Corporation generates $0.90 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Bank of America Corporation generates limited operating cash flow of $12.29B, signaling weaker underlying cash strength.
Free Cash Flow
Bank of America Corporation produces free cash flow of $12.29B, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $1.71 in free cash annually.
FCF Yield
BAC-PS converts 3.69% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
11.28
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.62
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.14
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.82
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.21
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.42
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.10
vs 25 benchmark
ROA
Return on assets percentage
0.009
vs 25 benchmark
ROCE
Return on capital employed
0.04
vs 25 benchmark
How BAC-PS Stacks Against Its Sector Peers
| Metric | BAC-PS Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 11.28 | 18.50 | Better (Cheaper) |
| ROE | 10.19% | 809.00% | Weak |
| Net Margin | 16.23% | 2211.00% | Weak |
| Debt/Equity | 1.21 | 0.90 | Weak (High Leverage) |
| Current Ratio | 0.42 | 692.04 | Weak Liquidity |
| ROA | 0.90% | -24328.00% (disorted) | Weak |
BAC-PS outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Bank of America Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
105.58%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
20.03%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
-117.30%
Industry Style: Value, Dividend, Cyclical
Declining