Entering text into the input field will update the search result below

Buy The Decline In Bank of America

May 04, 2022 12:40 AM ETBank of America Corporation (BAC)14 Comments
Geoff Considine profile picture
Geoff Considine


  • BAC is 24% below the 12-month high from early 2022.
  • Rising interest rates are favorable for this stock.
  • The Wall Street consensus outlook is bullish, with a 12-month price target that is 30% above the current share price.
  • The market-implied outlook (calculated from options prices) is bullish.
  • Selling covered calls can provide high income.

Street view on Bank of America branch in NYC with people waiting, pedestrians crossing, crosswalk, bike, road in Manhattan

ablokhin/iStock Editorial via Getty Images

Bank of America (NYSE:BAC) has fallen almost 8% over the past 12 months and 24% since the 12-month high closing price on February 8, 2022. The precipitous decline is even more notable given that BAC has beaten

This article was written by

Geoff Considine profile picture
Geoff has worked in quantitative finance for more than twenty years. Before entering finance, Geoff was a research scientist for NASA. Geoff holds a PhD in Atmospheric Science from the University of Colorado - Boulder and a BS in Physics from Georgia Tech. Neither Geoff Considine nor Quantext (Geoff's company) are investment advisors. Nothing in any commentary here on Seeking Alpha or elsewhere shall be regarded as advice.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of BAC either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I have sold covered calls against my long position in BAC

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (14)

mag1205 profile picture
BAC has fallen from it's high of $50 plus down to $36 plus some change. BAC won't recover to $50 this year in my opinion. Fundamentals are still in place but jittery markets and negative consensus are two factors which won't go away soon.

I have been long BAC since 2008 and staying optimistic.
hi best regards from Poland
if specialists advisors says to buy banks in time of crisis, it is not normal, looking for sheep only

right now we have to wait, the stock market is risk off for the moment

price is cheap but it will be much more cheaper then right now

wait for second or third bottom, maybe October?

I wish you good luck, stocks are normally right now only a hazard game ...
Thanks a lot
So minus Look on the market It is going down
Read the zerohedge article about bofa manager who said that market will go down
Look no the managers They are selling the stocks from all banks right gs ms citi bofa
It is not time to buy banks
Wait for October
Dont look on opinion of the analysts They will always tell you to buy banks but it will fall down You will see
There is to mych inflation To big pressure for sale of stocks Lot of people are on cash right now and waits

Remember do exactly opposit to opinion of analysts

Best regards from Poland Adam Stadnicki Orlenik
Best article in quite some time IMO. I will follow you on Monday.
BAC has now run 90% of its course. It can't grow much and it has become woke and stupid giving your money to BLM and other rip-off marxists.

For banks with real growth opportunities and better valuations (at the moment) look at AX and INBK. These are online-only banks that don't ever pay for heat, tellers, property taxes, or skyscrapers in Atlanta. AX has been growing profits at 15%+ for the last decade (even made a profit in 2008 an 2009). Take a peak. You will be shocked at how much better the financials and prospects are for these banks than for the dying woke monstrosity that is BAC.
More general question. In this recession environment, how will big banks be doing well? What about main street regional banks?
Old Professor profile picture
My most recent purchase was at $13 share.

BofA has been a roller-coaster or boom-and-bust stock for the four or five decades that I have followed it. It's good to buy during the almost inevitable "busts," and to sell during the almost inevitable "booms."
Interest rate hikes and buybacks will have a positive impact moving forward
SleepyInSeattle profile picture
BAC: still too high - HOLD
peer here is former cfo & cio of large bank. he was buying the banks in the summer of 2020 when no one wanted them - he’s buying them again this last week.
You’re calls are going to get exercised and lose out on a lot of upside over 8.5 months. I’d recommend going shorter term on covered calls.
@User 12154021 I agree. The strike price is set far too low.
Geoff Considine profile picture
@User 12154021 I think that you are probably correct. As I noted, however, my personal position with the covered calls sold on BAC is part of a slice of my portfolio that focuses on conservative (e.g. lower risk) income positions.
@Geoff Considine I'd probably debate with you are taking on more risk for the yield your attempting to get by sacrificing total return; sell weekly calls instead; you'll get similar returns with more control and more upside. you could also buy the US I-Bonds that yield 9.6%.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.