Bank of America Earnings Report Beats the Estimates

On Tuesday, Bank of America (BAC) released its quarterly earnings statement which showed better than expected numbers for the 2nd fiscal quarter of 2024.

The bank expected to earn 80 cents per share but managed 83 cents. The expected revenue for the quarter was $25.22 billion, but instead they earned $25.54 billion. The positive earnings report helped the company’s stock rise by $3.82% today to $43.48.

The company’s stock has risen significantly this year, staying bullish throughout much of 2024. After this quarterly report, the expectation is that they will continue to do very well and grow their stock for their shareholders.  

Revenue increased by less than 1%, and the company’s profits fell nearly 7% compared to last year. Overall profit for the quarter was $6.9 billion, which is significant enough to keep the interest in this stock high. Net income fell as interest rates remained high.

If the Federal Reserve cuts interest rates later this year, then that could help Bank of America earn a larger profit for the coming quarter. Right now, the Fed is on track to slash interest rates in August or September, a move that it has held off on for months due to high inflation that simply will not let up.

Bank of America Moving Forward

The Bank of America expects to do very well with net interest income, which should help it rake in considerable profits by the fourth quarter later this year. The numbers for net interest income (NII) fell by 3% but still brought in $13.86 billion for the company. The expectation is that later on this year, the bank will turn around this area of its banking and improve this important metric that many banks focus on.

NII shows what the bank is earning with loans compared to what it pays out on savings accounts. The bank anticipates that this will increase to $14.5 billion by the end of 2024.

The current quarter is expected to be the bottom level for NII, with vast improvement in that key area as the year continues.