Citi upgrades Bank of America to buy, pointing to a lighter regulatory environment

Bank of America is primed to get a boost from multiple tailwinds, according to Citi. Analyst Keith Horowitz upgraded shares to buy from neutral. He also lifted his target price for the stock to $54 from $46, which implies upside of 21% from Thursday’s close. BAC YTD mountain BAC YTD chart Horowitz noted pointed to an attractive valuation for Bank of America relative to peers such as JPMorgan Chase. “The valuation spread between BAC and JPM remains very outsized adjusted for returns, and assuming JPM is setting the table for where implied CoE for the group can go, we see very attractive risk/reward in BAC,” he wrote. Less regulation under a new Trump administration could also bolster Bank of America shares. “On regulation, BAC is a low-risk firm and could benefit from lighter regulatory environment, and we expect room to run with a proposal re-write on B3 potentially driving returns above our 15% normalized assumption,” the analyst added. Shares are up more than 32% year to date. They also rose 1% in the premarket following the upgrade. Analysts are generally bullish on the stock. Of the 24 who cover Bank of America, 17 have a buy or strong buy rating, LSEG data shows.