Weakness in the company's revenue
Highlights from the analysis by TheStreet Ratings Team goes as follows:
The gross profit margin for BANK OF AMERICA CORP is currently very high, coming in at 86.27%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, BAC's net profit margin of 0.70% significantly trails the industry average.
Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.6%. Since the same quarter one year prior, revenues slightly dropped by 3.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
BANK OF AMERICA CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, BANK OF AMERICA CORP increased its bottom line by earning $0.91 versus $0.25 in the prior year. For the next year, the market is expecting a contraction of 48.4% in earnings ($0.47 versus $0.91).
The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Commercial Banks industry. The net income has significantly decreased by 93.3% when compared to the same quarter one year ago, falling from $2,497.00 million to $168.00 million.