Wells Fargo & Co (WFC): Is Bank of America Corp (BAC) Headed to $15 a Share?

The answer to this question is twofold. First, unlike JPMorgan and Wells Fargo & Co (NYSE:WFC), shares of B of A have consistently traded below tangible book value since the financial crisis. Thus, they have further upside potential in the face of good news. And second, unlike Citigroup, which got approval last week to return only $1.2 billion in capital to shareholders via stock buybacks — all of which, by the way, will simply offset compensation-based stock grants — Bank of America Corp (NYSE:BAC) was given the go-ahead to repurchase $5 billion in common stock and an additional $5.5 billion in preferred stock.

The results fueled the conviction of analysts that were already bullish on the bank. For instance, on CNBC yesterday, noted analyst Meredith Whitney expressed her opinion that B of A’s shares “could have another 20% upside at current levels,” pricing the shares right around $15. And over the next 18 months, “the stock could be in the $20s,” she said. “Very rarely do these big banks have both value catalysts and momentum,” Whitney noted. “Bank of America had all of that.”

It’s for this reason, in turn, that Bank of America Corp (NYSE:BAC)’s shares, at least for the time being, have been able to sidestep an otherwise downbeat sentiment toward financial stocks today.

The article Is Bank of America Headed to $15 a Share? originally appeared on Fool.com and is written by John Maxfield

John Maxfield owns shares of Bank of America. The Motley Fool recommends Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo.

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