Bank of America Hits 52-Week High After Q2 Earnings Beat, Record Trading Revenue

Bank of America Corp. (NYSE: BAC) shares reached a new 52-week high Tuesday after the lender reported better-than-expected second-quarter earnings, powered by record stock-trading revenue and a surge in dealmaking fees.

The stock traded as high as $60.92, before last changing hands near $60.89, according to MarketBeat. The previous 52-week low stood at $44.75. Volume topped 11.2 million shares.

The Charlotte-based bank posted diluted earnings per share of $1.21, beating the consensus estimate of $1.13 by $0.08. Net income came in at $9.10 billion, according to AlphaStreet. Revenue rose to $31.60 billion, up 15% from a year earlier. The average deposit balance was $2.0 trillion for the quarter.

**Record Trading, Strong Investment Banking**

Equity-trading revenue jumped 70% year-over-year to $3.6 billion in the second quarter, a record, the bank said in a statement Wednesday, as reported by Bloomberg via the Financial Post. Fixed-income trading climbed nearly 9% to $3.5 billion, surpassing analyst expectations. The combined sales and trading division posted a record first half.

Investment banking revenue totaled $2.2 billion, above the average estimate of $1.91 billion compiled by Bloomberg. Fees from advising on mergers and acquisitions surged nearly 68% to $558 million. Equity-capital markets generated $535 million, while debt-underwriting revenue hit $1.1 billion—both above analyst forecasts.

Consumer banking led with $11.34 billion in revenue, up 5% year-over-year, according to AlphaStreet.

“Near-term, pipelines remain strong, and commercial borrowing has picked up,” Chief Executive Officer Brian Moynihan said in the statement.

**Costs Rise, Profit Surges**

Noninterest expenses rose 8% from a year earlier to $18.6 billion, higher than the $18.35 billion analysts expected, the bank said. Despite cost pressures, earnings per share advanced 34% from the $0.90 reported in the same quarter last year.

**Dividend and Analyst Actions**

Bank of America recently declared a quarterly dividend of $0.28 per share, paid June 26 to shareholders of record June 5. That represents an annualized payout of $1.12, yielding roughly 1.8% to 1.9%.

Several analysts raised their price targets following the results. Wells Fargo lifted its target to $67 from $65 with an “overweight” rating, MarketBeat reported. Morgan Stanley boosted its target to $67 from $61, also “overweight.” HSBC raised its target to $60 from $55 with a “buy” rating. Among 27 analysts covering the stock, 21 rate it a “buy” and six a “hold,” according to MarketBeat, giving a consensus “Moderate Buy” and an average price target of $62.19.

**Insider and Institutional Activity**

Insider Geoffrey S. Greener sold 126,756 shares at an average price of $53.01 on May 5, reducing his holding by 8.45%, according to MarketBeat. Insiders own 0.27% of the company.

Institutional investors and hedge funds own 70.71% of the stock. Several firms added to positions in the second quarter, including Ballast Inc. (up 65.6%), Dagco Inc. (up 337.2%), and Jump Financial LLC (up 38.4%), per filings.

**Market Context**

The earnings beat came amid a broader wave of big-bank results. JPMorgan Chase & Co. and Goldman Sachs Group Inc. also reported record stock-trading quarters, with Goldman’s equity traders pulling in $7.42 billion. Bank of America and its rivals took SpaceX public in the largest-ever IPO last month.

Despite the headline beat, some profit-taking emerged. MarketBeat noted that shares moved lower intraday as the market appeared to cash in gains after a pre-earnings run-up, even as the bank delivered strong top-line performance.