- Baird analyst David George upgraded Bank of America (BAC +1.3%) to Neutral from Underperform as recent weakness has helped overall bank risk-reward but not enough to be aggressive.
- Overall, Q1 2022 bank trends look mixed, George wrote in a note to clients. Preprovision net revenue outlook remains "challenging near term but expectations [are] being reset," he said. Average rates are higher from Q4 2021, credit quality stays healthy, and core loan growth moderated. In addition some fee category trends — such as trading, investment banking, and mortgage — look soft.
- Bank of America (NYSE:BAC) has underperformed the BKX and SPX since Nov. 1, 2021, when George downgraded the stock, bringing risk-reward more in balance.
- The analyst suggests adding Wells Fargo (WFC +3.2%) and PNC Financial (PNC +3.0%) on weakness.
- Earlier, Bank of America (BAC) consumer clients make $294B in payments in February
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