Bank of America Corp (NYSE:BAC) is in the limelight after Wells Fargo’s senior banking analyst Mike Mayo Increased the price target for the stock to $35 from $30. The analyst is bullish on the banking industry in general due to the increasing interest rates, low taxes and flexibility regulatory policies coming in 2018. Global economy is strengthening and Bank of America Corp (NYSE:BAC) will be one of the primary beneficiaries of the increased spending power. In the third quarter earnings call, Bank of America’s CEO Brian Moynihan said that the consumer activity is strengthening and people are spending more through P2P payments, ATMs and credit/debit cards. According to Moynihan, consumer spending in the first nine months of 2017 increased by 5%, compared to the same period in 2016.
Bank of America Corp (NYSE:BAC) is well aware of the changing landscape in the industry. The bank is ready to embrace blockchain and even cryptocurrencies. Several reports show that Bank of America is swiftly applying for several patents related to blockchain and cryptocurrencies. Bank of America has applied for a patent for “tracking and validation of an entity in a process data network”. This shows that Bank of America is working to revamp its business processes using the blockchain technology. Analysts think that Bank of America will be the pioneer in the blockchain-based banking industry.
Last month, Bank of America announced its plans to buyback $5 billion worth of its own shares. The plan comes just after 5 months of its massive $12 billion stock repurchase. The buybacks will boost the stock price later in 2018. Bank of America shares are up over 20% over the last 6 months.
Bank of America Corp (NYSE:BAC) stock is poised for more growth as the Trump administration will ease the banking regulations in 2018. The new government has so far rolled back Financial Choice Act, which is likely to get approved by the Senate. President Trump has also publicly grilled tight lending practices, and has ordered three reviews of banking rules. Analysts also think that Bank of America stock will rise as the authorities plan to keep raising the interest rates. In September, Fed chairwoman Janet Yellen said that the Federal Reserve will keep increasing the interest rates despite the weakness in inflation. Rising interest rates always bode well for the banks.
Legendary investor Warren Buffett is one of the biggest shareholders of Bank of America Corp(NYSE:BAC). In an interview with CNBC, the billionaire said that he plans to hold Bank of America stock for a