Wells Fargo on Bank of America (BAC): 'A turn in NII should lead to positive operating leverage...'

Wells Fargo analyst Mike Mayo reiterated an Overweight rating and $44.00 price target on Bank of America (NYSE: BAC).

The analyst comments "Headwinds now closer to tailwinds. BAC now expects NII (which beat) to inflect post 2Q24 given deposit pressure easing, better loan spreads, and less rate cuts; and for consumer loan losses to level off in 2024 given early stage delinquencies. All eyes on NII. NII increased QoQ vs. a prior guide for a decline, w/expectations for 2Q24 as the low point. Several factors help. First, deposits increased and there is a slowdown in the rate of interest paid on deposits (most rate-seeking behavior seems done). Second, loan spreads widened (utilization modestly better in com'l). Expected decline in 2Q24 is seasonal given Wealth (tax payments). A turn in NII should lead to positive operating leverage and YoY EPS growth 1-2 qtrs. thereafter."

For an analyst ratings summary and ratings history on Bank of America click here. For more ratings news on Bank of America click here.

Shares of Bank of America closed at $34.68 yesterday.

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