BofA Delivers Strong Q4, but Leverage Outlook Disappoints, TD Cowen Notes

Bank of America Corporation (NYSE:BAC) is included among the 15 Best S&P 500 Dividend Stocks to Buy successful 2026.

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On January 15, TD Cowen chopped its terms people connected Bank of America Corporation (NYSE:BAC) to $64 from $66, portion sticking with a Buy rating. The steadfast refreshed its exemplary aft BofA’s Q4 results came successful amended than expected. However, Cowen noted that management’s outlook for operating leverage landed toward the debased extremity of what investors were hoping to hear, which took immoderate radiance disconnected the beat.

Separately, Reuters reported connected January 20 that Bank of America plans to manus retired astir $1 cardinal worthy of equity to employees crossed the company, excluding elder management, aft wrapping up a beardown twelvemonth fueled by a crisp leap successful profits. The banal awards volition full adjacent to 19 cardinal shares and people the ninth twelvemonth successful a enactment that the slope has issued broad-based worker equity grants.

Earlier this month, BofA topped Wall Street’s expectations for fourth-quarter earnings. Trading desks benefited from volatile markets, portion the slope besides earned much from involvement income. For the afloat twelvemonth 2025, nett climbed to $30.5 billion, up from $27 cardinal the twelvemonth before. The banal besides had a beardown run, ending the twelvemonth up astir 25%, which is its 3rd consecutive twelvemonth of gains.

Looking ahead, the broader banking manufacture is gearing up for different progressive twelvemonth successful dealmaking. Investment banking revenues could amended arsenic large M&A enactment picks up again and much ample IPOs instrumentality to the market. On apical of that, nett involvement income could get a boost if indebtedness request improves, particularly with borrowing costs coming down and customers becoming much consenting to instrumentality connected debt.

Bank of America Corporation (NYSE:BAC) is 1 of the largest US fiscal institutions, with operations spanning user banking, wealthiness management, firm banking, and planetary markets.

While we admit the imaginable of BAC arsenic an investment, we judge definite AI stocks connection greater upside imaginable and transportation little downside risk. If you’re looking for an highly undervalued AI banal that besides stands to payment importantly from Trump-era tariffs and the onshoring trend, spot our escaped study connected the best short-term AI stock.

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